James Company purchased Thomas Manufacturing for $1,000,000 cash on January 1.The book value and fair value of the assets of Thomas as of the date of the acquisition follow:

In addition, Thomas had liabilities totaling $400,000 at the time of the acquisition. Thomas has no other separately identifiable intangible assets. Make the journal entry necessary on the books of James Company to record theacquisition.

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Book Value Fair Value Cash Accounts receivable. Inventory $10,000 100,000 200,000 $ 10,000 100,000 300,000 50,000 600,000 $1,060,000 I.... Patent Property plant, and equipment. 400.000 $710,000 Totals