The Balance Sheets of Palisade Company and Salisbury Corporation Were

Essay

The balance sheets of Palisade Company and Salisbury Corporation were as follows on December 31,2013:
$\begin{array}{|l|r|r|} \hline& \text { Palisade } & \text { Salisbury } \\\hline \text { Current Assets } & \$ 260,000 & \$ 120,000 \\\hline \text { Equipment-net } & 440,000 & 480,000 \\\hline \text { Buildings-net } & 600,000 & 200,000 \\\hline \text { Land } & \underline{100,000} & \underline{200,000} \\\hline \text { Total Assets } & \$ \underline{\underline{1,400,000}} & \$ \underline{\underline{1,000,000}} \\\hline \text { Current Liabilities } & 100,000 & 120,000 \\\hline \text { Common Stock, } \$ 5 \text { par } & 1,000,000 & 400,000 \\\hline \text { Additional paid-in Capital } & 100,000 & 280,000 \\\hline \text { Retained Earnings } & \underline{200,000} & 200,000 \\\hline \text { Total Liabilities and } & & \\\text { Stockholders' equity } & \$ 1,400,000 & \$ \underline{1,000,000} \\\hline\end{array}$ On January 1,2014 Palisade issued 30,000 of its shares with a market value of $40 per share in exchange for all of Salisbury's shares,and Salisbury was dissolved.Palisade paid $20,000 to register and issue the new common shares.It cost Palisade $50,000 in direct combination costs.Book values equal market values except that Salisbury's land is worth $250,000.
Required:
Prepare a Palisade balance sheet after the business combination on January 1,2014.