On January 1, 2021, the Marshall Company acquired 100 percent of the outstanding common shares of the Tucker Company. To acquire these shares, Marshall issued $267,000 in long-term liabilities and 20,000 shares of common stock with a par value of $1 per share but a fair value of $10 per share. Marshall paid $22,000 to accountants, attorneys and brokers for assistance in the acquisition and another $7,000 in connection with the costs of issuing shares.

Marshall Company Book Value				tucker company book value
Money	ps	60,900			ps	38,600
accounts receivable		277,000				91,000
Inventory		411,000				192,000
Tierra		215,000				224,000
Buildings (net)		501,000				276,000
Equipment (net)		220,000				50,700
Accounts payable		(226,000	)			(54,300	)
Long term passives		(493.000	)			(267.000	)
Common Stock: $1 par value		(110.000	)
Common Stock: $20 par value						(120.000	)
Additional payment in principal		(360.000	)			0
Retained earnings, 1/1/21		(495,900	)			(431.000	)

Before these transactions, the balance sheets of the two companies were as follows:

Note: Parentheses indicate a credit balance.

In Marshall's assessment of Tucker, three accounts were deemed to be undervalued on the subsidiary's books: $7,400 inventory, $33,000 land, and $42,000 buildings. Marshall plans to maintain Tucker's separate legal identity and operate Tucker as a wholly owned subsidiary.

1. Required
2. a. Determine the amounts that the Marshall Company would report on its post-acquisition balance sheet. In preparing the post-acquisition balance sheet, any required adjustments to the acquisition revenue accounts should be closed to Marshall's retained earnings. Other accounts will also need to be added or adjusted to reflect the journal entries Marshall prepared when recording the acquisition. show work
3. b. To verify the answers found in part (a), prepare a worksheet to consolidate the balance sheets of these two companies as of January 1, 2021. show work

Answer rating: 100% (QA)

Sure lets work through the calculations step by step a Marshall Companys PostAcquisition Balance Sheet First lets calculate the adjusted book values f... View the full answer