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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:

Assets

Cash & Equivalents.......... $ 41,000

Accounts Receivable.......... 73,000

Inventory............. 144,000

Land............... 200,000

Buildings.............. 1,520,000

Equipment.............. 638,000

Accumulated Depreciation....... (431,000)

Total Assets............. $2,185,000

Liabilities and Equities

Accounts Payable.......... $ 35,000

Short-Term Notes Payable..... 50,000

Bonds Payable.......... 500,000

Common Stock ($10 par)...... 1,000,000

Additional Paid-In Capital..... 325,000

Retained Earnings.......... 275,000

Total Liabilities & Equities...... $2,185,000

Immediately prior to the combination, Flint reported $250,000 additional paid-in capital and $1,350,000 retained earnings. 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.



Required

Prepare the journal entries that would appear on Flint’s books to record the combination if Flint issued 450,000 shares.

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