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The following book and fair values were available for Beech Company as of June 1: Items Inventory Land Buildings Trademarks Accounts payable Common stock Additional paid-in capital Retained earnings, 1/1. Revenues Expenses Book Value $551,500 Fair Value $ 515,250 771,000 1,050,750 1,895,000 2,252,000 825,000 (102,000) (102,000) (2,000,000) 0 (500,000) (430,000) (495,500) 310,000 0 0 0

The following book and fair values were available for Beech Company as of June 1: Items Inventory Land Buildings Trademarks Accounts payable Common stock Additional paid-in capital Retained earnings, 1/1. Revenues Expenses Book Value $551,500 Fair Value $ 515,250 771,000 1,050,750 1,895,000 2,252,000 825,000 (102,000) (102,000) (2,000,000) 0 (500,000) (430,000) (495,500) 310,000 0 0 0

FINANCIAL ACCOUNTING
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 following book and fair values were available for Beech Company as of June 1: Book Value Fair Value $551,500 $ 515,250 771,000 1,050,750 1,895,000 2,252,000 T 825,000 (102,000) (102,000) (2,000,000) (500,000) (430,000) Inventory Land Buildings Trademarks Accounts payable Common stock Additional paid-in capital Retained earnings, 1/1 Revenues Expenses Alder Company pays $4,040,000 cash and issues 20,500 shares of its $2 par value common stock (fair value of $50 per share) for all of Beech's common stock in a merger, after which Beech will cease to exist as a separate entity. Stock issue costs amount to $27,600, and Alder pays $46,900 for legal fees to complete the transaction. View transaction list Required: Prepare Alder's journal entries to record its acquisition of Beech. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet < Items < 1 Transaction 1 1 Note: Enter debits before credits. Record the acquisition of Beech Company. 2 Transaction 2 2 3 Note: Enter debits before credits. Transaction 3 3 | Record the legal fees related to the combination. (495,500) 310,000 General Journal Journal entry worksheet < 1 2 3 Record entry General Journal Record the payment of stock issuance costs. Note: Enter debits before credits. 0 0 General Journal Clear entry Debit Debit Debit Credit Credit Credit > View general journal > >
Transcribed Image Text:The following book and fair values were available for Beech Company as of June 1: Book Value Fair Value $551,500 $ 515,250 771,000 1,050,750 1,895,000 2,252,000 T 825,000 (102,000) (102,000) (2,000,000) (500,000) (430,000) Inventory Land Buildings Trademarks Accounts payable Common stock Additional paid-in capital Retained earnings, 1/1 Revenues Expenses Alder Company pays $4,040,000 cash and issues 20,500 shares of its $2 par value common stock (fair value of $50 per share) for all of Beech's common stock in a merger, after which Beech will cease to exist as a separate entity. Stock issue costs amount to $27,600, and Alder pays $46,900 for legal fees to complete the transaction. View transaction list Required: Prepare Alder's journal entries to record its acquisition of Beech. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet < Items < 1 Transaction 1 1 Note: Enter debits before credits. Record the acquisition of Beech Company. 2 Transaction 2 2 3 Note: Enter debits before credits. Transaction 3 3 | Record the legal fees related to the combination. (495,500) 310,000 General Journal Journal entry worksheet < 1 2 3 Record entry General Journal Record the payment of stock issuance costs. Note: Enter debits before credits. 0 0 General Journal Clear entry Debit Debit Debit Credit Credit Credit > View general journal > >
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