The stockholders' equities of Pal Corporation and Sip Corporation at January 1 were as follows (in thousands):

	Pal	Sip
Capital stock, $2 par	$20,000	$5,500
Other paid in capital	600	300
Retained earnings	6,400	3,900
Stockholders' equity	$27,000	$9,700

On January 2, Pal issued 559,000 of its shares with a market value of $18 per share for all of Sip's shares, and Sip was dissolved. On the same day, Pal paid $18,000 to register and issue the shares and $38,000 for other direct costs of combination. Prepare the journal entry for the acquisition of Sip Corporation (excluding the additional costs paid).

Answer rating: 100% (QA)

Sol Journal Entry Date Accounts 02Jan Investment in Sip 559000 18 0... View the full answer