The financial statement amounts for the Atwood Company and the Franz Company as of December 31, 2021, are presented below. Also included are the fair values for Franz Company's net assets (all numbers are in thousands). AtwoodFranz co.Franz Co. ParticularBook ValueBook Valuefair Value 12/31/202112/31/202112/31/2021Cash870240240Receivables660600600Inventory1,230420580Land1,800260250Buildings (net)1,800540650Equipment (net)660380400Accounts payable(570(240(240Accrued expenses(270(60(60Long-term liabilities(2,700(1,020(1,120Common stock ($20 par)(1,980 Common stock ($5 par) (420 Additional paid-in capital(210(180 Retained earnings 1/1/18(1,170(480 Revenues(2,880(660 Expenses2,760620 Note: Parenthesis indicates a credit balance. Assume an acquisition business combination took place on December 31, 2021. Atwood issued 50 shares of its common stock with a fair value of $35 per share for all of the outstanding common shares of Franz. Stock issuance costs of $15 (in thousands) and direct costs of $10 (in thousands) were paid.Compute consolidated inventory at the date of the acquisition

Acquisition is the taking over of the resources and obligations by one company of the other to have…

Answered: The financial statement amounts for the…

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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The financial statement amounts for the Atwood Company and the Franz Company as of December 31, 2021, are presented below. Also included are the fair values for Franz Company's net assets (all numbers are in thousands).

	Atwood	Franz co.	Franz Co.
Particular	Book Value	Book Value	fair Value
	12/31/2021	12/31/2021	12/31/2021
Cash	870	240	240
Receivables	660	600	600
Inventory	1,230	420	580
Land	1,800	260	250
Buildings (net)	1,800	540	650
Equipment (net)	660	380	400
Accounts payable	(570	(240	(240
Accrued expenses	(270	(60	(60
Long-term liabilities	(2,700	(1,020	(1,120
Common stock ($20 par)	(1,980
Common stock ($5 par)		(420
Additional paid-in capital	(210	(180
Retained earnings 1/1/18	(1,170	(480
Revenues	(2,880	(660
Expenses	2,760	620

Note: Parenthesis indicates a credit balance. Assume an acquisition business combination took place on December 31, 2021. Atwood issued 50 shares of its common stock with a fair value of $35 per share for all of the outstanding common shares of Franz. Stock issuance costs of $15 (in thousands) and direct costs of $10 (in thousands) were paid.

Compute consolidated inventory at the date of the acquisition

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