Glen Co. acquires 100 percent of the outstanding voting shares of Nutley Company on January...
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Glen Co. acquires 100 percent of the outstanding voting shares of Nutley Company on January 1, 2021. To obtain these shares, Glen pays $400 cash (in thousands) and issues 10,000 shares of $20 par value common stock on this date. Glen's stock had a fair value of $36 per share on that date. Glen also pays $15 (in thousands) to a local investment firm for arranging the acquisition. An additional $10 (in thousands) was paid by Glen in stock issuance costs. The book values for both Glen and Nutley immediately preceding the acquisition follow. The fair value of each of Glen and Nutley accounts is also included. In addition, Nutley holds a fully amortized trademark that still retains a $40 (in thousands) value. The figures below are in thousands. Any related question also is in thousands.
GLEN CO.
NUTLEY COMPANY
Book Value
Fair Value
CASH
$
900
$
80
$
80
RECEIVABLES
480
180
160
INVENTORY
660
260
300
LAND
300
120
130
BUILDINGS (NET)
1,200
220
280
EQUIPMENT
360
100
75
ACCOUNTS PAYABLE
480
60
60
LONG-TERM LIABILITIES
1,140
340
300
COMMON STOCK
1,000
80
ADDITIONAL PAID-IN CAPITAL
200
0
RETAINED EARNINGS
1,080
480
1) What amount will be reported for goodwill as a result of this acquisition?
2) What amount will be reported for consolidated additional paid-in capital?
3) What amount will be reported for consolidated cash after the acquisition is completed?
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