The following book and fair value were available for Westmont Company as of March 1.
Book Value Fair Value
Inventory 630,000 600,000
Land 750,000 990,000
Building 1,700,000 2,000,000
Customer re 0 800,000
A/P (80,000) (80,000)
Common Stock (2,000,000)
Additional paid (500,000)
Retained earnings (360,00)
Revenues (420,000)
Expenses 280,000
Arturo Company pays $4,000,000 cash issues 20,000 shares of its $2 par value common stock (fair value of $50 per share) for all of Westmont's common stock in a merger, after which Westmont will cease to exist as a separate entity. Stock issue cost amount to $25,000 and Arturo pays $42,000 for legal fees to complete the transaction. Prepare Arturo's journal entry to record its accusiation of Westmont.