The Following Are Preliminary Financial Statements for Black Co

question 65

Essay

The following are preliminary financial statements for Black Co. and Blue Co. for the year ending December 31, 2013.
On December 31, 2013 (subsequent to the preceding statements), Black exchanged 10,000 shares of its $10 par value common stock for all of the outstanding shares of Blue. Black's stock on that date has a fair value of $50 per share. Black was willing to issue 10,000 shares of stock because Blue's land was appraised at $204,000. Black also paid $14,000 to several attorneys and accountants who assisted in creating this combination.
Required:
Assuming that these two companies retained their separate legal identities, prepare a consolidation worksheet as of December 31, 2013.

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Definitions:

Larva

The juvenile form of many animals before undergoing metamorphosis, often differing significantly in form and habit from the adult stage.

Develop

To grow or cause to grow and become more mature, advanced, or elaborate.

Accumulated Degree Hours

A measurement used in forensic entomology and agriculture to estimate the growth and development rates of organisms by accumulating temperature over time.

Larva

A larva is the juvenile form of many animals, which undergoes metamorphosis before becoming an adult, often differing markedly in form and behavior from the adult stage.