Condensed balance sheets for Concord Company and Oriole Company on January $1,2023,$ are as

follows:

Concord : Oriole

Current assets $$270,000$ : $$127,500$

Plant and equipment $($net$)675,000$ : $210,000$

Total assets $$945,000$ : $$337,500$

Total liabilities $$142,500$ : $$52,500$

Common stock, $$10$ par value $525,000$ : $240,000$

Other contributed capital $187,500$ : $79,500$

Retained earnings $($deficit$)90,000$ : $(34,500)$

TotaOn January $1,2023,$ the stockholders of Concord and Oriole agreed to a consolidation. Because

FASB requires that one party be recognized as the acquirer and the other as the acquiree, it was

agreed that Concord was acquiring Oriole. Concord agreed to issue $30,000$ shares of its $$10$ par

stock to acquire all the net assets of Oriole at a time when the fair value of Concord's common

stock was $$15$ per share.

On the date of consolidation, the fair values of Oriole$’$s current assets and liabilities were equal to

their book values. The fair value of plant and equipment was, however, $$220,000.$ Concord will

incur $$30,000$ of direct acquisition costs and $$9,000$ in stock issue costs.

Prepare the journal entries on the books of Concord to record the acquisition of Oriole

 

Transcribed Image Text:

< > > (To record assets and liabilities acquired) (To record the direct acquisition costs) (To record the stock issue costs) < > > (To record assets and liabilities acquired) (To record the direct acquisition costs) (To record the stock issue costs)

Answer rating: 100% (QA)

To record the acquisition of Oriole by Concord and the related costs ... View the full answer