Use the following to answer questions 2-5: On January 1, 2000, Richard Company acquired all the net assets of Ulmer Company by issuing bonds with a face value and market value of $500,000 and cash of $300,000. The business combination was accounted for as a purchase. The fair values of Ulmer's identifiable net assets equaled their book values, except for buildings and equipment which had a fair value of $120,000 greater than book value. Balance sheets for the two companies immediately preceding the acquisition were as follows: Cash Buildings & Equipment Accumulated Depreciation Other Identifiable Assets Total Assets Richard Co. $400,000 700,000 (300,000) 100,000 $900,000 Ulmer Co. $150,000 400,000 (150,000) 200,000 $600,000 Liabilities Common Stock Additional Paid-In Capital Retained Earnings Total Liabilities and Equity $200,000 400,000 160,000 140,000 $900,000 $100,000 300,000 100,000 100,000 $600,000 2. Based on the information given above, the dollar balance of the Buildings & Equipment account in the balance sheet of the combined companies immediately following the merger should be [note: the question asks for gross B&E, and assumes that S's acc. depr. account is netted against Ss gross B&E prior to assigning fair value increment]: A) $1,100,00 B) $1,220,000 C) $1,070,000 D) $700,000 3. Based on the information given above, the amount of Goodwill to be recognized in connection with the merger is: A) $0 $180,000 $200,000 $300,000 @ b 4. Based on the information given above, the amount for Cash, Liabilities, and total Paid-In Capital (common stock plus additional paid-in capital) that should appear on the balance sheet of the combined companies immediately following the merger should be: A) B) Cash $550,000 250,000 550,000 250,000 Total Paid-In Liabilities Capital $300,000 $560,000 700,000 660,000 800,000 800,000 800,000 560,000 @ d 5. Based in the information given above, the total gain that should be recognized by Ulmer Company in accounting for the sale of its net assets to Richard Company is: A) $200,000 B) $300,000 $80,000 $0