Question

On January 2nd Hulk Company acquired 75% of the outstanding stock of Spiderman Company by issuing (SELLING)
200,000 shares of its common stock when the stock was worth $6 per share at this time Spiderman's
equipment is worth $110,000; its building is worth $190,000 and their customer list was worth $50,000
The building and equipment and building have a 10 year life with no salvage (AS OF 1/1/2019) and the
customer list has a 5 year life.
On January 1st 2019 Hulk Company and Spiderman Company had the following balance sheets
		HULK CO.		SPIDERMAN CO.
Cash		500,000		40,000
accounts receivable		500,000		10,000
inventory		500,000		50,000
equipment		500,000		100,000
accumulated dep. Equipment		100,000		10,000
building		500,000		100,000
accumulated dep. Building		100,000		10,000
total assets		2,300,000		280,000
accounts payable		100,000		50,000
common stock $1 par		2,000,000		200,000
additional paid in capital		100,000		10,000
retained earnings		100000		20,000
REQUIRED;
A) make the journal entry Hulk makes when it acquires the stock of Spiderman
B) make the journal entry Spidermand makes when its stock is acquired by Hulk
C) make the necessary worksheet entries
D) prepare a consolidated balance sheet on January 2nd.

Answer 1