On August 15, 2009, Willis Inc. purchased all of the outstanding common stock of Bork Inc. paying $7,400,000 cash. The book values and fair values of Willis' assets and liabilities are listed below:
Required:
Prepare the journal entry to record the acquisition by Willis Inc.
$\begin{array}{lrr}&\text { Book Value } & \text { Fair Value } \
\text { Accounts receivable } & \$ 1,080,000 & \$ 975,000 \
\text { Inventories } & 1,620,000 & 2,400,000 \
\text { Property, plant, and equipment } & 5,400,000 & 6,975,000 \
\text { Accounts payable } & 1,800,000 & 1,800,000 \
\text { Bonds payable } & 2,700,000 & 2,475,000
\end{array}$

Question

On August 15, 2009, Willis Inc. purchased all of the outstanding common stock of Bork Inc. paying $7,400,000 cash. The book values and fair values of Willis' assets and liabilities are listed below:
Required:
Prepare the journal entry to record the acquisition by Willis Inc.
 $\begin{array}{lrr}&\text { Book Value } &  \text { Fair Value } \
\text { Accounts receivable } & \$ 1,080,000 & \$ 975,000 \
\text { Inventories } & 1,620,000 & 2,400,000 \
\text { Property, plant, and equipment } & 5,400,000 & 6,975,000 \
\text { Accounts payable } & 1,800,000 & 1,800,000 \
\text { Bonds payable } & 2,700,000 & 2,475,000
\end{array}$

Quizplus · Accepted Answer

The Answer of On August 15, 2009, Willis Inc. purchased all of the outstanding common stock of Bork Inc. paying $7,400,000 cash. The book values and fair values of Willis' assets and liabilities are listed below:
Required:
Prepare the journal entry to record the acquisition by Willis Inc.
 $\begin{array}{lrr}&\text { Book Value } &  \text { Fair Value } \
\text { Accounts receivable } & \$ 1,080,000 & \$ 975,000 \
\text { Inventories } & 1,620,000 & 2,400,000 \
\text { Property, plant, and equipment } & 5,400,000 & 6,975,000 \
\text { Accounts payable } & 1,800,000 & 1,800,000 \
\text { Bonds payable } & 2,700,000 & 2,475,000
\end{array}$