Problem - On June 30, 2011 Wisconsin, Inc., issued $300000 in debt and 15000 new shares of its $10 par value stock to Badger Company owners in exchange for all of the outstanding shares of that company. Wisconsin shares had a fair value of $40 per share. Prior to the combination, the financial statements for Wisconsin and Badger for the six-month period ending June 30, 2011, were as follows:
Wisconsin (In dollars) Badger
Revenues...... (900000) (300000)
Expenses......... 660000 200000
Net income... (240000) (100000)
Retained earnings, 1/1(800000) (200000)
Net income....................................(240000) (100000)
Dividends paid..................... 90000 0
Retained earnings,6/30(950000) (300000)
Cash............................................. 80000 110000
Receivables and Inventory 400000 170000 Patented technology (net)900000 300000 Equipment(net).....................700000 600000
Total assets........................2080000 1180000
Liabilities..................(500000) (410000)
Common stock...............(360000) (200000)
Additional paid in capital(270000) (270000) Retained earnings... (950000) (300000)
Total liabilities and equities (2080000) (1180000)
Wisconsin also paid $30000 to a broker for arranging the transaction. In addition, Wisconsin paid $40000 in stock issuance costs. Badger's equipment was actually worth $700000, but its patented technology was valued at only $280000.
What are the consolidated balances for the following accounts?
- Net income
- Retained earnings, 1/1/11
- Patented technology
- Goodwill
- Liabilities
- Common stock
- Additional paid-in capital.