. Zaid Ltd and Zafar Ltd agreed to merge on January 1, 2019. On the date of the merger agreement, the companies reported the following data:
|
Balance Sheet |
Zaid Ltd |
Zafar Ltd |
||
|
Book Value |
Fair Value |
Book Value |
Fair Value |
|
|
Cas & Receivables |
80,000 |
80,000 |
10,000 |
10,000 |
|
Inventory |
110,000 |
160,000 |
40,000 |
52,000 |
|
Machinery |
120,000 |
150,000 |
50,000 |
75,000 |
|
Land & Building |
480,000 |
350,000 |
250,000 |
200,000 |
|
Accumulated Depreciation |
(130,000) |
(50,000) |
||
|
Total Assets |
660,000 |
740,000 |
300,000 |
337,000 |
|
Current Liabilities |
100,000 |
120,000 |
75,000 |
75,000 |
|
Common Stock |
300,000 |
50,000 |
||
|
Capital in excess of Par Value |
40,000 |
10,000 |
||
|
Retained Earnings |
220,000 |
165,000 |
||
|
Total Liabilities |
660,000 |
300,000 |
||
Zaid Ltd has 15,000 shares of its $20 par value shares outstanding on January 1, 20X3, and Zafar Ltd has 10,000 shares of $5 par value stock outstanding. The market values of the shares are $400 and $75, respectively.
0 comments