Jean and John Inc had the following balance sheets on August 31, 2022, just before acquisition:

	Jean Inc.	John Inc.
	(carrying value)	(carrying value)
Cash	$1,200,000	$300,000
Accounts Receivable	$ 400,000	$ 64,000
Inventory	$ 240,000	$ 80,000
Plant and Equipment (net)	$ 860,000	$256,000
Trademark	-	$ 20,000
Total Assets	$2,700,000	$720,000
Accounts Payable	$1,500,000	$300,000
Bonds Payable	$ 600,000	$240,000
Common Shares	$ 500,000	$ 60,000
Retained Earnings	$ 100,000	$120,000
Total Liabilities and Equity	$2,700,000	$720,000

On August 31^, 2022, Jean's date of acquisition, Jean Inc. purchased 55% of John Inc. by issuing common shares for $245,000.

You were given the following fair values for John Inc. on the date of acquisition:

Inventory - $60,000

Plant & Equipment - $300,000

Trademark - $36,000

Bonds Payable $210,000

How to prepare a Consolidated Balance Sheet, on the Date of Acquisition.

Answer rating: 100% (QA)

To prepare a consolidated balance sheet on the date of acquisition we need to combine the balance sh... View the full answer