On January 2, 20X8, Total Corporation acquired 75 percent of Ticken Tie Companys outstanding common stock. In

On January 2, 20X8, Total Corporation acquired 75 percent of Ticken Tie Company’s outstanding common stock. In exchange for Ticken Tie’s stock, Total issued bonds payable with a par value of $500,000 and fair value of $510,000 directly to the selling stockholders of Ticken Tie. At that date, the fair value of the noncontrolling interest was $170,000. The two companies continued to operate as separate entities subsequent to the combination. Immediately prior to the combination, the book values and fair values of the companies’ assets and liabilities were as follows:

At the date of combination, Ticken Tie owed Total $6,000 plus accrued interest of $500 on a shortterm note. Both companies have properly recorded these amounts.

Required
a. Record the business combination on the books of Total Corporation.
b. Present in general journal form all elimination entries needed in a worksheet to prepare a consolidated balance sheet immediately following the business combination on January 2, 20X8.
c. Prepare and complete a consolidated balance sheet worksheet as of January 2, 20X8, immediately following the business combination.
d. Present a consolidated balance sheet for Total and its subsidiary as of January 2,20X8.

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Total Ticken Tie Book Value Fair Value Book Value Fair Value S 9,000 30,000 Cash Receivables Allowance for Bad Debts Inventory Land Buildings & Equipment Accumulated Depreciation Patent Total Assets 12,000 41,000 12,000 39,000 $ 9,000 31,000 (2,000) (1,000) 86,000 55,000 960,000 (411,000) 89,000 200,000 650,000 68,000 50,000 670,000 (220,000) 72,000 70,000 500,000 40,000 721,000 29,000 100,000 $741,000 $990,000 $607,000 Current Payables Bonds Payable Common Stock Additional Paid-in Capital Retained Earnings Total Liabilities & Equity $ 38,000 200,000 300,000 100,000 103,000 $741,000 29,000 100,000 200,000 130,000 148,000 $607,000 38,000 210,000