On January 1, 2018, Grand Corp. purchased Minor Co., paying $250,000 cash and issuinga $50,000 note payable. On January 1, 2018, the balance sheet of Minor Co. was asfollows:1.Minor CompanyBalance SheetAssetsLiabilities and Owners' EquityCash$40,000Notes Payable$55,000Acc. Receivable80,000Capital280,000Inventory120,000$335,000Buildings(net)Eguipment(net)50,00030,000Patents5,000Trademarks10,000$335,000An appraisal indicated that the fair market value of the receivables was $75,000, and thefair market value of inventory and buildings were $110,000 and $70,000 respectively.According to the apRraisal, the patents were worthless.Required: Prepare the journal entry to be record the purchase by Grand Corp.

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On January 1, 2018, Grand Corp. purchased Minor Co., paying $250,000 cash and issuing a $50,000 note payable. On January 1, 2018, the balance sheet of Minor Co. was as I. follows: Minor Company Balance Sheet Assets Liabilities and Owners' Equity Cash $40,000 Notes Payable $55,000 Acc. Receivable 80,000 Capital 280,000 Inventory 120,000 $335,000 Buildings(net) Equipment(net) 50,000 30,000 5,000 10,000 Patents Trademarks $335,000 An appraisal indicated that the fair market value of the receivables was $75,000, and the fair market value of inventory and buildings were $110,000 and $70,000 respectively. According to the appraisal, the patents were worthless. Required: Prepare the journal entry to be record the purchase by Grand Corp.

On January 1, 2018, Grand Corp. purchased Minor Co., paying $250,000 cash and issuing a $50,000 note payable. On January 1, 2018, the balance sheet of Minor Co. was as I. follows: Minor Company Balance Sheet Assets Liabilities and Owners' Equity Cash $40,000 Notes Payable $55,000 Acc. Receivable 80,000 Capital 280,000 Inventory 120,000 $335,000 Buildings(net) Equipment(net) 50,000 30,000 5,000 10,000 Patents Trademarks $335,000 An appraisal indicated that the fair market value of the receivables was $75,000, and the fair market value of inventory and buildings were $110,000 and $70,000 respectively. According to the appraisal, the patents were worthless. Required: Prepare the journal entry to be record the purchase by Grand Corp.

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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