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Bullen Inc Assume That Bullen Issued 12,000 Shares of Common Stock with Vicker

question 73

Multiple Choice

Bullen Inc. acquired 100% of the voting common stock of Vicker Inc. on January 1, 2013. The book value and fair value of Vicker's accounts on that date (prior to creating the combination) follow, along with the book value of Bullen's accounts: $\begin{array}{lrrr}&\text { Bullen } & \text { Vicker } & \text { Vicker } \\&\text { Book } & \text { Book } & \text { Fair } \\&\text { Value } & \text { Value } & \text { Value }\\\hline\text { Retained earnings, 1/1/15 } & \mathbf{\$ 2 5 0 , 0 0 0} & \mathbf{\$ 2 4 0 , 0 0 0} & \\\text { Cash and receivables } & 170,000 & 70,000 & \mathbf{\$ 7 0 , 0 0 0} \\\text { Inventory } & 230,000 & 170,000 & 210,000 \\\text { Land } & 280,000 & 220,000 & 240,000\\\text { Buildings (net) } & 480,000 & 240,000 & 270,000 \\\text { Equipment (net) } & 120,000 & 90,000 & 90,000 \\\text { Liabilities } & 650,000 & 430,000 & 420,000 \\\text { Common stock } & 360,000 & 80,000 & \\\text { Additional paid-in capital } & 20,000 & 40,000 &\end{array}$ Assume that Bullen issued 12,000 shares of common stock with a $5 par value and a $42 fair value for all of the outstanding shares of Vicker. What will be the consolidated Additional Paid-In Capital and Retained Earnings (January 1, 2013 balances) as a result of this acquisition transaction?

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Earning Capacity

An individual's potential or ability to generate income from employment or other means, often considered in legal contexts relating to compensation for loss or injury.

Breach

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Statute of Frauds

A legal concept that requires certain types of contracts to be written and signed by the party or parties to be charged, in order to be legally enforceable.

Oral Contract

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