Liberty Inc. acquired 100% of the voting common stock of ValanceInc. on January 1, 2018 by issuing 4,000 shares of Liberty Inc. $40par value common stock that had a fair value of $120 per share.Valance Inc. will dissolve after the acquisition.Liberty incurred $40,000 of legal and accounting fees; and paid$25,000 in stock issuance costs as a result of this acquisition.The book value and fair value of Valance’s accounts on that date(prior to creating the combination) along with the book value ofPace's accounts are shown below:
| Liberty | Valance | Valance |
| Book | Book | Fair |
| Value | Value | Value |
Retained earnings, 1/1/18 | $(250,000) | $(240,000) | |
Cash Receivables | 100,000 70,000 | 20,000 50,000 | $20,000 50,000 |
Inventory | 230,000 | 170,000 | 210,000 |
Land | 280,000 | 220,000 | 240,000 |
Buildings (net) | 480,000 | 240,000 | 270,000 |
Equipment (net) | 120,000 | 90,000 | 90,000 |
Liabilities | (650,000) | (430,000) | (420,000) |
Common stock | (360,000) | (80,000) | |
Additional paid-in capital | (20,000) | (40,000) | |
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