Current Attempt in Progress

Your answer is partially correct.

Balance sheets for Salt Company and Pepper Company on December $31,2013,$ follow:

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|\}$

$\backslash$hline & Salt & Pepper $\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{3\}\{|$l$|\}\{$ASSETS$\}\backslash \backslash$

$\backslash$hline Cash & $\backslash (\backslash$$ $87,640\backslash )$ & $\backslash$$$169,300\backslash \backslash$

$\backslash$hline Receivables & $111,780$ & $239,620\backslash \backslash$

$\backslash$hline Inventories & $134,500$ & $217,089\backslash \backslash$

$\backslash$hline Plant assets & $629,210$ & $1,130,970\backslash \backslash$

$\backslash$hline Total assets & $\backslash (\backslash$$ $963,130\backslash )$ & $\backslash$$$1,756,979\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{3\}\{|$l$|\}\{$EQUITIES$\}\backslash \backslash$

$\backslash$hline Accounts payable & $\backslash$$$165,940$ & $\backslash$$$235,319\backslash \backslash$

$\backslash$hline Mortgage payable & $158,910$ & $189,900\backslash \backslash$

$\backslash$hline Common stock, $\backslash (\backslash$$ $20\backslash )$ par value & $317,800$ & $848,300\backslash \backslash$

$\backslash$hline Other contributed capital & $180,150$ & $251,880\backslash \backslash$

$\backslash$hline Retained earnings & $140,330$ & $231,580\backslash \backslash$

$\backslash$hline Total equities & $\backslash$$$963,130$ & $\backslash$$$1,756,979\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$

Pepper Company tentatively plans to issue $28,200$ shares of its $\backslash (\backslash$$ $20\backslash )$ par value stock, which has a current market value of $\backslash (\backslash$$ $36\backslash )$ per share net of commissions and other issue costs. Pepper Company then plans to acquire the assets and assume the liabilities of Salt Company for a cash payment of $\backslash (\backslash$$ $843,300\backslash )$ and $\backslash (\backslash$$ $329,800\backslash )$ in long$-$term $\backslash (8\backslash \%\backslash )$ notes payable. Pepper Company's receivables include $\backslash (\backslash$$ $61,050\backslash )$ owed by Salt Company. Pepper Company is willing to pay more than the book value of Salt Company assets because plant assets are undervalued by $\backslash (\backslash$$ $231,000\backslash )$ and Salt Company has historically earned above$-$normal profits.

Prepare a pro forma balance sheet showing the effects of these planned transactions. $($If an amount reduces the account balance then enter with negative sign preceding the number e$.$g$.\backslash (-5,125\backslash )$ or parentheses e$.$g$.\backslash ((5,125)\backslash ).)$

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|$c$|$c$|$c$|\}$

$\backslash$hline $\backslash$multicolumn$\{6\}\{|$c$|\}\{\backslash$begin$\{$tabular$\}\{$l$\}$

PEPPER COMPANY $\backslash \backslash$

Pro Forma Balance Sheet $\backslash \backslash$

Giving Effect to Proposed Issue of Common Stock and Note Payable for All of the Common Stock of Salt Company under Purchase Accounting December $31,2013$

$\backslash$end$\{$tabular$\}\}\backslash \backslash$

$\backslash$hline & Audited & & & & $\backslash \backslash$

$\backslash$hline & Balance Sheet & & Adjustments & & heet $\backslash \backslash$

$\backslash$hline Cash & $\backslash$$$169,300$ & $\backslash$$ & & $\backslash$$ & $\backslash \backslash$

$\backslash$hline Receivables & $239,620$ & & & & $\backslash \backslash$

$\backslash$hline Inventories & $217,089$ & & $134500$ & & $\backslash \backslash$

$\backslash$hline Plant Assets & $1,130,970$ & & & & $\backslash \backslash$

$\backslash$hline Goodwill & $0$ & & & & $\backslash \backslash$

$\backslash$hline Total Assets & $1,756,979$ & & & $\backslash$$ & $\backslash \backslash$

$\backslash$hline Accounts Payable & $235,319$ & & & $\backslash$$ & $\backslash \backslash$

$\backslash$hline Notes Payable, $8\backslash \%$ & $0$ & & $329800$ & & $329800\backslash \backslash$

$\backslash$hline Mortgage Payable & $189,900$ & & & & $\backslash \backslash$

$\backslash$hline Common Stock, $\backslash$$$20$ par & $848,300$ & & $564000$ & & $\backslash \backslash$

$\backslash$hline Additional Paid$-$in Capital & $251,880$ & & $451200$ & & $\backslash \backslash$

$\backslash$hline Retained Earnings & $231,580$ & & $0$ & & $231580\backslash \backslash$

$\backslash$hline Total Liabilities and Equity & $1,756,979$ & & & $\backslash$$ & $\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$ look at picture and show steps