Do not give answer in image Ayayai Company acquired the assets (except for cash) and assumed the liabilities of Blossom Company on January 1, 2024, paying$721,000 cash. Blossom Company's December 31, 2023, balance sheet, reflecting both book values and fair values, showed:Accounts receivable (net)InventoryLandBuildings (net)Equipment (net)TotalAccounts payableNote payableCommon stock, $2 par valueOther contributed capitalRetained earningsTotalBook Value$73,00087,000109,600370,000238,000$84,000181,000154,000230,000Fair Value228,600$877,600$65,500$877,600 $1,072,000100,900165,800448,300291,500$84,000181,000 As part of the negotiations, Ayayai Company agreed to pay the former stockholders of Blossom Company $217,000 cash if the post-combination earnings of the combined company (Ayayai) reached certain levels during 2024 and 2025. The fair value of contingentconsideration was estimated to be $145,800 on the date of acquisition.Type here to search(a)Record the journal entry on the books of Pham Company to record the acquisition on January 1, 2024. (Credit account titles areautomatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titlesand enter O for the amounts. List all debit entries before credit entries.)DateJan. 1,2024Account Titles and ExplanationCDebitCredit

Business acquisition tends to be the purchase of a business which includes inputs to the business,…

Ayayai Company acquired the assets (except for cash) and assumed the liabilities of Blossom Company on January 1, 2024, paying $721,000 cash. Blossom Company's December 31, 2023, balance sheet, reflecting both book values and fair values, showed: Accounts receivable (net) Inventory Land Buildings (net) Equipment (net) Total Accounts payable Note payable Common stock. $2 par value Other contributed capital Retained earnings Total Book Value $73,000 87,000 109,600 370,000 238,000 $84,000 181,000 154,000 291,500 $877,600 $1,072,000 230,000 228,600 Fair Value $877,600 $65,500 100,900 165,800 448,300 $84,000 181,000

Ayayai Company acquired the assets (except for cash) and assumed the liabilities of Blossom Company on January 1, 2024, paying $721,000 cash. Blossom Company's December 31, 2023, balance sheet, reflecting both book values and fair values, showed: Accounts receivable (net) Inventory Land Buildings (net) Equipment (net) Total Accounts payable Note payable Common stock. $2 par value Other contributed capital Retained earnings Total Book Value $73,000 87,000 109,600 370,000 238,000 $84,000 181,000 154,000 291,500 $877,600 $1,072,000 230,000 228,600 Fair Value $877,600 $65,500 100,900 165,800 448,300 $84,000 181,000

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 25E

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