Problem
On July 1, TruData Company issues 11,950 shares of its common stock with a $5 par value and a $38 fair value in exchange for all of Webstat Company's outstanding voting shares. Webstat's precombination book and fair values are shown below along with book values for TruData's accounts.
| |
TruData
|
Webstat
|
Webstat
|
| |
Book Values
|
Book Values
|
Fair Values
|
|
Revenues (1/1 to 7/1)
|
$(263,250)
|
$(144,000)
|
|
|
Expenses (1/1 to 7/1)
|
211,000
|
95,500
|
|
|
Retained earnings, 1/1
|
(164,000)
|
(158,000)
|
|
|
Cash and receivables
|
43,500
|
33,750
|
$ 33,750
|
|
Inventory
|
229,500
|
185,500
|
231,100
|
|
Patented technology (net)
|
285,750
|
149,500
|
175,100
|
|
Land
|
429,000
|
230,000
|
267,200
|
|
Buildings and equipment (net)
|
105,500
|
78,500
|
78,500
|
|
Liabilities
|
(567,000)
|
(370,750)
|
(343,150)
|
|
Common stock
|
(300,000)
|
(70,000)
|
|
|
Additional paid-in capital
|
(10,000)
|
(30,000)
|
|
1. On its acquisition-date consolidated balance sheet, what amount should TruData report as goodwill?
2. On its acquisition-date consolidated balance sheet, what amount should TruData report as patented technology (net)?