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X Industries paid $540,000 to purchase 75% of the outstanding stock of Z Corporation, on December 31, 2016. The following year-end information was available just before the purchase:

X Z Z

Book Book Fair

Value Value Value

Cash $756,000 $80,000 $80,000

Accounts Receivable 260,000 152,000 152,000

Inventory 480,000 100,000 120,000

Land 440,000 160,000 140,000

Plant and equipment-net 1,320,000 400,000 430,000

$3,256,000 $892,000 $922,000

Accounts Payable $880,000 $22,000 $22,000

Bonds Payable 936,000 200,000 180,000

Capital stock, $10 par value 400,000

Capital stock, $15 par value 450,000

Additional paid-in capital 400,000 160,000

Retained earnings 640,000 60,000

$3,256,000 $892,000

Required:

1. Prepare the preliminary calculations to determine the implied fair value and the identifiable excesses of fair value over book value.
2. Prepare X's consolidated balance sheet on December 31, 2016. (Hint, There is no Goodwill.

Debit Credit Assets 80,000 152,000 100,000 160,000 400,000 216,000 260,000 net Inventories 480,000 Land 440,000 Plant asgets net 1,320,000 Investments in Tree 540,000 Total Assets 3,256,000 892,000 880,000 936,000 200,000 400,000 $450,000 160,000 60,000 Bonds payable Capital Stock Additional paid-in- 400,000 640,000 Total Liabilities and Equity 3,256,000 892,000 40000 740000

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