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  3. on july 1, 2019, smith corporation purchased jones

On July 1, 2019, Smith Corporation purchased Jones Corporation by paying $250,000 in cash and...

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Accounting

On July 1, 2019, Smith Corporation purchased Jones Corporation by paying $250,000 in cash and issuing a $100,000 note payable to Mr. Jones. At July 1, 2019 the balance sheet of Jones Corporation was as follows: Cash $50,000 A/R 90,000 Inventory 100,000 Land 40,000 Buildings net 75,000 Equipment net 70,000 Trademarks 10,000 $435,000 A/P $200,000 Equity 235,000 $435,000 The recorded amounts all approximate current values except for land (fair values $60,000), inventory (fair value of $125,000), and trademarks (fair value of $15,000). Prepare the July 1, 2019 journal entry to record the purchase by Smith Corporation.

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