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Flint Corporation exchanged shares of its $2 par common stock for all of Mark Company’s assets and liabilities in a planned merger. Immediately prior to the combination, Mark’s assets and liabilities were as follows:AssetsCash & Equivalents………. $ 41,000Accounts Receivable………. 73,000Inventory…………. 144,000Land…………… 200,000Buildings………….. 1,520,000Equipment………….. 638,000Accumulated Depreciation……. (431,000)Total Assets…………. $2,185,000Liabilities and EquitiesAccounts Payable………. $ 35,000Short-Term Notes Payable….. 50,000Bonds Payable………. 500,000Common Stock ($10 par)…… 1,000,000Additional Paid-In Capital….. 325,000Retained Earnings………. 275,000Total Liabilities & Equities…… $2,185,000Immediately prior to the combination, Flint reported $250,000 additional paid-in capital and $1,350,000 retained earnings.

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The fair values of Mark’s assets and liabilities were equal to their book values on the date of combination except that Mark’s buildings were worth $1,500,000 and its equipment was worth $300,000. Costs associated with planning and completing the business combination totaled $38,000, and stock issue costs totaled $22,000. The market value of Flint’s stock at the date of combination was $4 per share.RequiredPrepare the journal entries that would appear on Flint’s books to record the combination if Flint issued 450,000 shares. Get Accounting Help Today