Power Company purchased Sark Corporation's net assets on January 3, 20X2, for $629,000 cash. In addition,...

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Power Company purchased Sark Corporation's net assets on January 3, 20X2, for $629,000 cash. In addition, Power incurred $14,000 of direct costs in consummating the combination. At the time of acquisition, Sark reported the following historical cost and current market data: Balance Sheet Item Assets Cash and Receivables Inventory Buildings and Equipment (net) Patent Total Assets Liabilities and Equities Accounts Payable Common Stock Additional Paid-In Capital Retained Earnings Book Value Fair Value $ 55,000 107,000 216,000 $ 378,000 $ 20,000 81,000 68,000 209,000 $ 55,000 151,000 314,000 205,000 $ 725,000 $ 20,000 Total Liabilities and Equities Required: $ 378,000 Prepare the journal entry or entries with which Power recorded its acquisition of Sark's net assets. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet A B Record the payment of acquisition costs. Note: Enter debits before credits. Event 1 General Journal Debit Credit Record entry Clear entry View general journal Power Company purchased Sark Corporation's net assets on January 3, 20X2, for $629,000 cash. In addition, Power incurred $14,000 of direct costs in consummating the combination. At the time of acquisition, Sark reported the following historical cost and current market data: Balance Sheet Item Assets Cash and Receivables Inventory Buildings and Equipment (net) Patent Total Assets Liabilities and Equities Accounts Payable Common Stock Additional Paid-In Capital Retained Earnings Book Value Fair Value $ 55,000 107,000 216,000 $ 378,000 $ 20,000 81,000 68,000 209,000 $ 55,000 151,000 314,000 205,000 $ 725,000 $ 20,000 Total Liabilities and Equities Required: $ 378,000 Prepare the journal entry or entries with which Power recorded its acquisition of Sark's net assets. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet A B Record the payment of acquisition costs. Note: Enter debits before credits. Event 1 General Journal Debit Credit Record entry Clear entry View general journal

Answer rating: 100% (QA)

Heres the journal entry for Power Company to record the acquisition of Sarks net assets Event Genera... View the full answer