QUESTION 1The financial statements for Campbell, Inc., and Newton Company for the year ended December 31, 2021, prior to the business combination whereby Campbell acquired Newton, are as follows (inthousands):RevenuesExpensesNet incomeRetained earnings, 1/1Net incomeDividendsRetained earning, 12/31CashReceivables and inventoryBuildings (net)Equipment (net)Total assetsLiabilitiesCommon stockAdditional paid-in capitalRetained earningsCampbell Newton$ 2,600$ 7001,880400$300$ 5003000$ 800$ 230$ 720$ 2,400720(270)$ 2,850$ 2401,2002,7002,100$ 6,240$ 1,5001,0808103606501,300$ 2,540$ 7204006202,850800Total liabilities & stockholders' equity $ 6,240 $ 2,540On December 31, 2021, Campbell obtained a loan for $650 and used the proceeds, along with the transfer of 35 shares of its $10 par value common stock, in exchange for all of Newton's commonstock. At the time of the transaction, Campbell's common stock had a fair value of $40 per share.In connection with the business combination, Campbell paid $25 to a broker for arranging the transaction and $30 in stock issuance costs. At the time of the transaction, Newton's equipment wasactually worth $1,450 but its buildings were only valued at $590.What total amount of additional paid-in capital will Campbell recognize from this acquisition?$1,400.$1,020.$1,105.$1,080.$1,050.

The additional paid in capital is simply the amount of which has been paid by the stockholders over…

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Business

Accounting

What total amount of additional paid-in capital will Campbell recognize from this acquisition?

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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