Telecom Inc has decided to purchase the net assets of Intron Inc. for $300, 000 in cash on July 1, 2019. On the date, the balance sheets of each of these companies were as follows:
Cash and Short-Term Securities Inventory Plant and Equipment (net) Total Assets Current Liabilities Bonds Payable Common Shares Retained Earnings Total Liabilities and Equity Telecom Inc $920,000$150,000$330,000$1,400,000$420,000$700,000$180,000$100,000$1,400,000 Intron Inc $200,000$20,000$180,000$400,000$90,000$200,000$60,000$50,000$400,000 On that date, the fair values of Intron's assets and liabilities were as follows:
Cash/Short-Term Securities Inventory Plant and Equipment (net) Current Liabilities Bonds Payable $200,000$15,000$250,000$90,000$210,000 Required:
Prepare the journal entry to record this purchase.
Definitions:
Rep Test
A technique used in psychology to explore an individual's personal constructs, specifically how they perceive and interpret their world and the people in it.
Personal Construct
An individual's unique mental framework used to interpret and understand the world around them.
Psychological Disorders
Patterns of behavioral or psychological symptoms that impact multiple areas of life and create distress for the person affected.
Kelly's Conception
A psychological theory proposed by George Kelly, focusing on personal constructs as fundamental elements in understanding and predicting human behavior.