Required information 29 Prior to being united in a business combination, Botkins

Question

Required information 29 Prior to being united in a business combination, Botkins Inc. and Volkerson Corp. had the following stockholders' equity figures 10 points Common stock ($1 par value) Additional paid-in capital Retained earnings Botkins Volkerson 220,000 54,000 110,000 25,000 360,000 130,000 03:45 37 Botkins issued 56,000 new shares of its common stock valued at $3.25 per share for all of the outstanding stock of Volkerson Skopped Assume that Botkins acquired Volkerson on January 1, 2017. Immediately afterwards, what is the value of the consolidated Common Stock?

Explanation / Answer

Consolidated balance sheet reflects the stockholders' equity of the acquired company and the common stock of the acquired company is reflected by the assets and liabilities acquired. therefore the common stockof the consolidated company in the present case will be the common stock value of Botkins.

Working:

Consolidated Common stock value (220,000+56,000) 276000

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