Ramrod Manufacturing acquired all the assets and liabilities of Stafford Industries on January 1, 20X2, in exchange for 4,000 shares of Ramrod€™s $20 par value common stock. Balance sheet data for both companies just before the merger are given as follows:

Ramrod shares were selling for $150 on the date of acquisition.

Required
Prepare the following:
a. Journal entries to record the acquisition on Ramrod€™s books.
b. A balance sheet for the combined enterprise immediately following the businesscombination.

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Ramrod Manufacturing Stafford Industries Balance Sheet Items Book Value Fair Value ook Value Fair Value Cash Accounts Receivable 70,000 100,000 200,000 50,000 $ 70,000 30,000 30,000 60,000 160,000 30,000 350,000 100,000 375,000 80,000 540,000 60,000 100,000 40,000 400,000 150,000) Buildings & Equipment Less: Accumulated Depreciation Total Assets Accounts Payable Bonds Payable (250,000) $770,000 $1,165,000 $480,000 $630,000 50,000 300,000 $ 50,000 10,000 10,000 145,000 9 310,000 150,000 Common Stock: $20 par value 200,000 $5 par value Additional Paid-In Capital Retained Earnings Total Liabilities & Equities 40,000 180,000 770,000 100,000 20,000 200,000 $480,000