Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2021, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts: Book Values Fair Values Current assets $ 55,250 $ 55,250 Building 105,500 61,900 Land 18,750 35,350 Trademark 0 37,400 Goodwill 20,000 ? Liabilities (64,500 ) (64,500 ) Common stock (100,000 ) Retained earnings (35,000 ) 1&2. Prepare Allerton’s entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: $170,000 and $108,000. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2021, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts: Book Values Fair Values Current assets $ 55,250 $ 55,250 Building 105,500 61,900 Land 18,750 35,350 Trademark 0 37,400 Goodwill 20,000 ? Liabilities (64,500 ) (64,500 ) Common stock (100,000 ) Retained earnings (35,000 ) 1&2. Prepare Allerton’s entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: $170,000 and $108,000. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2021, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts:
| Book Values |
Fair Values |
|||||
| Current assets | $ | 55,250 | $ | 55,250 | ||
| Building | 105,500 | 61,900 | ||||
| Land | 18,750 | 35,350 | ||||
| Trademark | 0 | 37,400 | ||||
| 20,000 | ? | |||||
| Liabilities | (64,500 | ) | (64,500 | ) | ||
| Common stock | (100,000 | ) | ||||
| (35,000 | ) | |||||
1&2. Prepare Allerton’s entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: $170,000 and $108,000. (If no entry is required for a transaction/event, select "No
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