Asked by JAVARIN OTHONG on Jun 28, 2024
Verified
Jernigan Corp. had the following account balances at 12/1/20: 
Several of Jernigan's accounts have fair values that differ from book value. The fair values are: Land - $480,000; Building - $720,000; Inventory - $336,000; and Liabilities - $396,000. Inglewood Inc. acquired all of the outstanding common shares of Jernigan by issuing 20,000 shares of common stock having a $6 par value per share, but a $66 fair value per share. Stock issuance costs amounted to $12,000.Required:Prepare a fair value allocation and goodwill schedule at the date of the acquisition.
Fair Value Allocation
The process of assigning a fair market value to all assets and liabilities of a company, often conducted during the acquisition process.
Par Value
Par value is the nominal or face value of a bond, stock, or other financial instrument, as stated by the issuer.
Common Stock
Shares of ownership in a corporation that entitle the shareholder to a share of the company’s profits and a right to vote on company matters.
- Create a fair value allocation and goodwill schedule as part of the business combination process.
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MR
Learning Objectives
- Create a fair value allocation and goodwill schedule as part of the business combination process.