Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2015,...

Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2015, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts:

	Book Values		Fair Values
Current assets	$	41,500	$	41,500
Building		108,000		67,000
Land		17,000		35,200
Trademark		0		31,800
Goodwill		19,000		?
Liabilities		(50,500)		(50,500)
Common stock		(100,000)
Retained earnings		(35,000)

Prepare Allerton’s entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

(1)	$166,000.

Record the acquisition method entry for merger with Deluxe Company.

(2)

$96,000.

Record the acquisition entry for the bargain purchase under the acquisition method with Deluxe Company.

Expert Solution

ekkarill92 answered 1 year ago

Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2018,...

Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2018, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts: Book Values Fair Values Current assets $ 61,000 $ 61,000 Building 91,750 44,650 Land 31,000 45,700 Trademark 0 37,600 Goodwill 15,000 ? Liabilities (63,750 ) (63,750 ) Common stock (100,000 ) Retained earnings (35,000 ) 1&2. Prepare Allerton’s entry to record its...

Allerton Company acquires all of Deluxe Company’s assets andliabilities for cash on January 1, 2018,...

Allerton Company acquires all of Deluxe Company’s assets and liabilities for cash on January 1, 2018, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts:BookValuesFairValuesCurrent assets$60,000$60,000Building90,00050,000Land10,00020,000Trademark030,000Goodwill15,000?Liabilities(40,000)(40,000)Common stock(100,000)Retained earnings(35,000)1&2. Prepare Allerton’s entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: $145,000 and $110,000. (If no entry is required for a transaction/event, select "No journal entry required" in the first account...

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