The following financial statement information was prepared for Blue Corporation and Sparse Company at December 31, 20X2:

Blue and Sparse agreed to combine as of January 1, 20X3. To effect the merger, Blue paid finder€™s fees of $30,000 and legal fees of $24,000. Blue also paid $15,000 of audit fees related to the issuance of stock, stock registration fees of $8,000, and stock listing application fees of $6,000. At January 1, 20X3, book values of Sparse Company€™s assets and liabilities approximated market value except for inventory with a market value of $200,000, buildings and equipment with a market value of $350,000, and bonds payable with a market value of $105,000. All assets and liabilities were immediately recorded on Blue€™s books.

Required
Give all journal entries that Blue recorded assuming Blue issued 40,000 shares of $8 par value common stock to acquire all of Sparse€™s assets and liabilities in a business combination. Blue common stock was trading at $14 per share on January 1,20X3.

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Balance Sheets December 31, 20X2 Blue Corporation Sparse Company $ 70,000 110,000 180,000 100,000 Cash Accounts Receivable Inventory Land Buildings & Equipment Less: Accumulated Depreciation Goodwill Total Assets 140,000 170,000 250,000 80,000 680,000 320,000) S 450,000 360,000 (230,000) 220,000 20,000 $700,000 $195,000 100,000 10,000 150,000 60,000 185,000 $700,000 70,000 1,070,000 S 70,000 320,000 Accounts Payable Bonds Payable Bond Premium Common Stock Additional Paid-In Capital Retained Earnings Total Liabilities & Equities 120,000 170,000 390,000 1,070,000