Compute the book value of equity acquired

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On January 1, 2013, Pam Company purchased an 85% interest in Shaw Company for $537,300. On this date, Shaw Company had common stock of $401,900 and retained earnings of $135,400.

An examination of Shaw Company's assets and liabilities revealed that their book value was equal to their fair value except for marketable securities and equipment:

                                           Book Value                    Fair Value

Marketable securities          $19,800                    $45,000

Equipment (net)                  119,600                139,900

Problem (a) Computation and Allocation Schedule for the difference between book value of equity acquired and the value implied by the purchase price. (Round answers to 0 decimal places, e.g. 5,125.)

Reference no: EM132660856

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