On December 31, 20X3, Saxe Corporation was merged into Poe Corporation. In the business combination, Poe issued 200,000 shares of its $10 par common stock, with a market price of $18 a share, for all of Saxe’s common stock. The stockholders’ equity section of each company’s balance sheet immediately before the combination was:

In the December 31, 20X3, combined balance sheet, additional paid-in capital should be reported at

a. $950,000.

b. $1,300,000.

c. $1,450,000.

d. $2,900,000.

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Poe Saxe Common Stock $3,000,000 $1,500,000 Additional Paid-In Capital 1,300,000 150,000 Retained Earnings 2.500.000 850.000 $6.800,000 $2,500,000