Business Combination Versus Asset Acquisition Haley Corporation pays $3,900.000 in cash to acquire assets from Jaxon Inc.. as follows: Fair Value $1,800,000 1.260,000 540,000 Machinery and equipment Developed technology (limited-life) Customer lists (limited-life) In addition, Haley pays $100.000 in cash for legal and advisory costs connected with the acquisition. Required Note: Enter all zeros with your numerical answers, do not abbreviate your answers in thousands or in millions. a. Prepare the journal entry to record the acquisition, assuming it qualifies as a business combination. Credit Machinery and equipment Developed technology Customer lists Merger expenses Goodwill Cash To record the business.combination Debit 1,800,000 Machinery and equipment Developed technology Customer lists To record the asset acquisition 1,260,000 540,000 100.000 300.000 0 0 0 0 0 0 b. Prepare the journal entry to record the acquisition, assuming it is an asset acquisition. Debit Credit 0 4,000,000 0 0

Business Combination Versus Asset Acquisition Haley Corporation pays $3,900.000 in cash to acquire assets from Jaxon Inc.. as follows: Fair Value $1,800,000 1.260,000 540,000 Machinery and equipment Developed technology (limited-life) Customer lists (limited-life) In addition, Haley pays $100.000 in cash for legal and advisory costs connected with the acquisition. Required Note: Enter all zeros with your numerical answers, do not abbreviate your answers in thousands or in millions. a. Prepare the journal entry to record the acquisition, assuming it qualifies as a business combination. Credit Machinery and equipment Developed technology Customer lists Merger expenses Goodwill Cash To record the business.combination Debit 1,800,000 Machinery and equipment Developed technology Customer lists To record the asset acquisition 1,260,000 540,000 100.000 300.000 0 0 0 0 0 0 b. Prepare the journal entry to record the acquisition, assuming it is an asset acquisition. Debit Credit 0 4,000,000 0 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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