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On January 1 2013 Pinnacle Corporation exchanged $3200000 cash for 100 percent of the outstanding voting stock of Strata Corporation

On January 1, 2013, Pinnacle Corporation exchanged $3,200,000 cash for 100 percent of the outstanding voting stock of Strata Corporation. Pinnacle plans to maintain Strata as a wholly owned subsidiary with separate legal status and accounting information systems. At the acquisition date, Pinnacle prepared the following fair-value allocation schedule Fair value of Strata (consideration transferred) . . . . . . . . . . . . . . . . . . . $3,200,000 Carrying amount acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,600,000 Excess fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 600,000 to buildings (undervalued) . . . . . . . . . . . . . . . . . . . . . . $ 300,000 to licensing agreements (overvalued) . . . . . . . . . . . . . . (100,000) . . . . . 200,000 to goodwill (indefinite life) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 400,000 Immediately after closing the transaction, Pinnacle and Strata prepared the following post acquisition balance sheets from their separate financial records. Prepare a January 1, 2013, consolidated balance sheet for Pinnacle Corporation and its subsidiary Strata Corporation.

Apr 22 2020 View more View Less

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