Barstow Company is contemplating the acquisition of the

net assets #6205

Barstow Company is contemplating the acquisition of the net assets of Crown Company for
$875,000 cash. To complete the transaction, acquisition costs are $15,000. The balance sheet
of Crown Company on the purchase date is as follows:The following fair values have been
obtained for Crown's identifiable assets and liabilities:Current assets...................................$ 85,
000Land...............................................90,000Building...........................................300,000Equip
ment.......................................275,000Liabilities........................................102,0001. Record the
acquisition of the net assets of Crown Company on Barstow Company's books.2. Record the
sale of the net assets on the books of Crown Company.3. Record the acquisition of 100% of the
common stock of Crown Company on Barstow's books. Crown Company will remain a separate
legal entity.View Solution:
Barstow Company is contemplating the acquisition of the net assets

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