Lucky's acquires Waterview, Inc., by issuing 40,000 shares of $1 par common stock with a market price of $25 per share on the acquisition date and paying $125,000 cash. The assets and liabilities onWaterview's balance sheet were valued at fair values except equipment that was undervalued by $300,000. There was also an unrecorded patent valued at $40,000, as well as an unrecorded trademark valuedat $75,000. In addition, the agreement provided for additional consideration, valued at $60,000, if certain earnings targets were met.The pre-acquisition balance sheets for the two companies at acquisition date are presented below.Lucky'sWaterview$ 300,000250,000CashAccounts receivableInventoryProperty, plant, and equipmentAccounts payableSalaries and taxes payableNotes payableCommon stockAdditional paid-in capitalRetained earningsCompute the consolidated balance in Cash.Select one:OOOA. $435,000B. $475,000C. $560,000D. $300,000254,0002,300,000$3,104,000$ 260,000135,000275,000356,500$1,026,500$ 45,000 $ 37,500450,00046,000500,000450,000250,00060,000950,000106,500909,000326,500$3,104,000$1,026,500

Name: Lucky's acquires Waterview, Inc., by issuing 40,000 shares of $1 par
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Description: Lucky's acquires Waterview, Inc., by issuing 40,000 shares of $1 par common stock with a market price of $25 per share on the acquisition date and paying $125,000 cash. The assets and liabilities onWaterview's balance sheet were valued at fair value

To compute the consolidated balance in Cash, we need to combine the cash balances from Lucky's and…

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Business

Accounting

Compute the consolidated balance in Cash. Select one: OA. $435,000 O B. $475,000 C. $560,000 D. $300,000 O

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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