On July 1, 2017, Sheffield Corporation purchased Young Company by paying $252,80

Question

On July 1, 2017, Sheffield Corporation purchased Young Company by paying $252,800 cash and issuing a $137,000 note payable to Steve Young. At July 1, 2017, the balance sheet of Young Company was as follows. Cash Accounts receivable Inventory Land Buildings (net) Equipment (net) Trademarks $50,400 90,100 110,000 41,200 76,400 69,900 11,700 $449,700 Accounts payable Stockholders' equity $204,000 245,700 $449,700 The recorded amounts all approximate current values except for land (fair value of $60,300), inventory (fair value of $127,200), and trademarks (fair value of $16,080) Prepare the July 1 entry for Sheffield Corporation to record the purchase. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit

Explanation / Answer

Inventory 127200 Accounts Receivable 90100 Land 60300 Buildings 76400 Equipment 69900 Cash 50400 Trademarks 16080 Goodwill 103420          Cash 252800          Accounts Payable 204000          Notes Payable 137000

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