Reference no: EM132588906

Allerton Company acquires all of Deluxe Company's assets and liabilities for cash on January 1, 2018, and subsequently formally dissolves Deluxe.

At the acquisition date, the following book and fair values were available for the Deluxe Company accounts:

                                                  Book                   Fair

                                                   Values              Values

Current assets                        $36,750        $36,750

Building                                    114,000        70,800

Land                                         16,000        29,500

Trademark                                   0               32,400

Goodwill                                      29,750               ?

Liabilities                                (61,500)             (61,500)

Common stock (100,000)

Retained earnings (35,000)

Question 1: Show Allerton's entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: $147,000 and $81,000.

Question 2: Record the acquisition of Delex assuming the cash exchange of $147,000