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Following are preacquisition financial balances for Padre Company and Sol Company as of December 31. Also included are fair values for Sol Company accounts. Padre Сompany Book Values Book Values Fair Values 12/31 193,250 228,000 602,500 765,000 765,000 224,000 (350,000) (119,000) (995,000) (660,000) Sol Company 12/31 72,900 S 369,000 190,000 195,000 271,000 216,000 (138,000) (47,500) (552,500) 12/31 Cash 72,900 369,000 242, 200 166, 200 340,000 249,900 (138,000) (47,500) (552,500) Receivables Inventory Land Building and equipment (net) Franchise agreements Accounts payable Accrued expenses Longterm liabilities Common stock-$20 par value Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues (70,000) (522,500) (1,841,250) 980, 000 (210,000) (90,000) (251,000) (352,900) 328,000 Expenses Note: Parentheses indicate a credit balance. On December 31, Padre acquires Sol's outstanding stock by paying $108,000 in cash and issuing 17,000 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $24,300 as well as $10,300 in stock issuance costs. Determine the value that would be shown in Padre's consolidated financial statements for each of the accounts listed. (Input all amounts as positive values.) Accounts Amounts Inventory Land Buildings and equipment Franchise agreements Goodwill Revenues Additional paid-in capital Expenses Retained earnings, 1/1 Retained earnings, 12/31

Following are preacquisition financial balances for Padre Company and Sol Company as of December 31. Also included are fair values for Sol Company accounts. Padre Сompany Book Values Book Values Fair Values 12/31 193,250 228,000 602,500 765,000 765,000 224,000 (350,000) (119,000) (995,000) (660,000) Sol Company 12/31 72,900 S 369,000 190,000 195,000 271,000 216,000 (138,000) (47,500) (552,500) 12/31 Cash 72,900 369,000 242, 200 166, 200 340,000 249,900 (138,000) (47,500) (552,500) Receivables Inventory Land Building and equipment (net) Franchise agreements Accounts payable Accrued expenses Longterm liabilities Common stock-$20 par value Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues (70,000) (522,500) (1,841,250) 980, 000 (210,000) (90,000) (251,000) (352,900) 328,000 Expenses Note: Parentheses indicate a credit balance. On December 31, Padre acquires Sol's outstanding stock by paying $108,000 in cash and issuing 17,000 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $24,300 as well as $10,300 in stock issuance costs. Determine the value that would be shown in Padre's consolidated financial statements for each of the accounts listed. (Input all amounts as positive values.) Accounts Amounts Inventory Land Buildings and equipment Franchise agreements Goodwill Revenues Additional paid-in capital Expenses Retained earnings, 1/1 Retained earnings, 12/31

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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**Preacquisition Financial Balances for Padre Company and Sol Company as of December 31** Below are the preacquisition financial balances for both Padre Company and Sol Company, including the fair values for Sol Company's accounts. | Account | Padre Company Book Values 12/31 | Sol Company Book Values 12/31 | Sol Company Fair Values 12/31 | |------------------------------|-------------------------------|-----------------------------|-------------------------------| | Cash | $193,250 | $72,900 | $72,900 | | Receivables | 228,000 | 369,000 | 369,000 | | Inventory | 662,500 | 190,000 | 242,200 | | Land | 102,800 | 195,000 | 166,200 | | Building and equipment (net) | 765,000 | 271,000 | 340,000 | | Franchise agreements | 224,000 | 216,000 | 249,000 | | Accounts payable | (350,000) | (138,000) | (138,000) | | Accrued expenses | (119,000) | (47,500) | (47,500) | | Long-term liabilities | (995,000) | (552,500) | (552,500) | | Common stock–$20 par value | (660,000) | - | - | | Common stock–$5 par value | - | (210,000) | - | | Additional paid-in capital | (70,000) | (90,000) | - | | Retained earnings, 1/1 | (522,500) | (251,000) | - | | Revenues | (1,041,250) | (352,900) | - | | Expenses | 980,000 | 328,000 | - | *Note: Parentheses indicate a credit balance.* **Acquisition Details** On December 31, Padre acquires Sol’s outstanding stock by paying $108,000 in cash and issuing 17,000 shares of its own common stock with a fair
Transcribed Image Text:**Preacquisition Financial Balances for Padre Company and Sol Company as of December 31** Below are the preacquisition financial balances for both Padre Company and Sol Company, including the fair values for Sol Company's accounts. | Account | Padre Company Book Values 12/31 | Sol Company Book Values 12/31 | Sol Company Fair Values 12/31 | |------------------------------|-------------------------------|-----------------------------|-------------------------------| | Cash | $193,250 | $72,900 | $72,900 | | Receivables | 228,000 | 369,000 | 369,000 | | Inventory | 662,500 | 190,000 | 242,200 | | Land | 102,800 | 195,000 | 166,200 | | Building and equipment (net) | 765,000 | 271,000 | 340,000 | | Franchise agreements | 224,000 | 216,000 | 249,000 | | Accounts payable | (350,000) | (138,000) | (138,000) | | Accrued expenses | (119,000) | (47,500) | (47,500) | | Long-term liabilities | (995,000) | (552,500) | (552,500) | | Common stock–$20 par value | (660,000) | - | - | | Common stock–$5 par value | - | (210,000) | - | | Additional paid-in capital | (70,000) | (90,000) | - | | Retained earnings, 1/1 | (522,500) | (251,000) | - | | Revenues | (1,041,250) | (352,900) | - | | Expenses | 980,000 | 328,000 | - | *Note: Parentheses indicate a credit balance.* **Acquisition Details** On December 31, Padre acquires Sol’s outstanding stock by paying $108,000 in cash and issuing 17,000 shares of its own common stock with a fair
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