Reference no: EM132634781

Planter Corporation used debentures with a par value of $625.000 to acquire 100 percent of Sorden Company's net assets on January 1, 20X2. On that date, the fair value of the bonds issued by Planter was $ 608.000. The following balnce sheet date were reported by Sorden:

Cash&Receivable ; Carrying Amount $55.000 ; Fair value $50.000

Inventory ; Carrying Amount 105.000 ; Fair value 200.000

Land ; Carrying Amount 60.000 ; Fair value 100.000

Plant&Equipment ; Carrying Amount 400.000 ; Fair value 300.000

Less ACC. Depreciation ; Carrying Amount (150.000) ; Fair value -

Goodwill ; Carrying Amount 10.000 ; Fair value -

Total asset ; Carrying Amount 480.000 ; Fair value 650.000

Account payable ; Carrying Amount 50.000 ; Fair value 50.000

Commonn stock ; Carrying Amount 100.000 ; Fair value -

ADD paid in capital ; Carrying Amount 60.000 ; Fair value -

Retained Earnings ; Carrying Amount 270.000 ; Fair value -

Total Liabilities & Equities ; Carrying Amount 480.000 ; Fair value -

Question 1: determine the amount Planter Corporation would record as a gain on bargain purchase and prepare the journal entry Planter would record atnthe time of the exchange if Planter issued bonds with a par value of $580.000 and a fair value $564.000 in completing the acquisition of Sorden.