On December 31, Pacifica, Incorporated, acquired 100 percent of the voting stock of Seguros Company. Pacifica will maintain Segurosas a wholly owned subsidiary with its own legal and accounting identity. The consideration transferred to the owner of Segurosincluded 59,530 newly issued Pacifica common shares ($20 market value, $5 par value) and an agreement to pay an additional$130,000 cash if Seguros meets certain project completion goals by December 31 of the following year. Pacifica estimates a 50percent probability that Seguros will be successful in meeting these goals and uses a 4 percent discount rate to represent the timevalue of money.Immediately prior to the acquisition, the following data for both firms were available:RevenuesExpensesNet incomeRetained earnings, 1/1Net incomeDividends declaredRetained earnings, 12/31CashItemsReceivables and inventoryProperty, plant, and equipmentTrademarksTotal assetsLiabilitiesPacifica$ (2,150,000)1,505,000$ (645,000)Seguros Book Seguros FairValuesValues0000000$ (1,013, 000)(645,000)183,000$ (1,475,000)$ 173,000811,0001,530,000368,000$ 2,882,000 $ 1,009,000$ (532,000)(258,000) $ (258,000)(400,000)(200,000)(70,000)(475,000)(1,475,000)(481,000)$ (2,882,000) (1,009,000)$ 105,000174,000496,000234,00000$00000$ 105,000154,100695,500279,0000Common stockAdditional paid-in capitalRetained earningsTotal liabilities and equitiesIn addition, Pacifica assessed a research and development project under way at Seguros to have a fair value of $197,000. Although notyet recorded on its books, Pacifica paid legal fees of $19,100 in connection with the acquisition and $9,700 in stock issue costs.0000Required:a. Prepare Pacifica's journal entries to record the consideration transferred to the former owners of Seguros, the direct combinationcosts, and the stock issue and registration costs.h and Present a worksheet showing the nostacquisition column of accounts for Pacifica and the consolidated balance sheet as of

Journal entries are those entries that are reported into the books of accounts of the company and…

On December 31, Pacifica, Incorporated, acquired 100 percent of the voting stock of Seguros Company. Pacifica will maintain Seguros as a wholly owned subsidiary with its own legal and accounting identity. The consideration transferred to the owner of Seguros included 59,530 newly issued Pacifica common shares ($20 market value, $5 par value) and an agreement to pay an additional $130,000 cash if Seguros meets certain project completion goals by December 31 of the following year. Pacifica estimates a 50 percent probability that Seguros will be successful in meeting these goals and uses a 4 percent discount rate to represent the time value of money. Immediately prior to the acquisition, the following data for both firms were available: Revenues Expenses Net income Retained earnings, 1/1 Net income Dividends declared Retained earnings, 12/31 Cash Items Receivables and inventory Property, plant, and equipment Trademarks Total assets Liabilities Common stock Additional paid-in capital Retained earnings Pacifica $ (2,150,000) 1,505,000 $ (645,000) Seguros Book Seguros Fair Values Values 0 0 0 0 $ (1,013,000) (645,000) 183,000 $ (1,475,000) $ 173,000 811,000 1,530,000 368,000 $ 2,882,000 $ 1,009,000 $ (532,000) (400,000) (475,000) (1,475,000) (70,000) (481,000) A $ $ (2,882,000) (1,009,000) 0 0 0 $ 105,000 174,000 496,000 234,000 0 0 0 0 0 0 0 $ 105,000 154,100 695,500 279,000 0 (258,000) $ (258,000) (200,000) 0 Total liabilities and equities. In addition, Pacifica assessed a research and development project under way at Seguros to have a fair value of $197,000. Although not yet recorded on its books, Pacifica paid legal fees of $19,100 in connection with the acquisition and $9,700 in stock issue costs. 0 Required: a. Prepare Pacifica's journal entries to record the consideration transferred to the former owners of Seguros, the direct combination costs, and the stock issue and registration costs. h and Present a worksheet showing the nostacquisition column of accounts for Pacifica and the consolidated balance sheet as of