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Prepare the journal entry to record the acquisition

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Reference no: EM13540077

On August 15, 2006, Willis Inc. purchased all of the outstanding common stock of Bork Inc. paying $7,400,000 cash. The book values and fair values of Willis' assets and liabilities are listed below:

Book Value Fair Value

Account Receivable

$1,080,000

$975,000

Inventories

$1,620,000

$2,400,000

Property Plant and equipment

$5,400,000

$6,975,000

Account Payable

$1,800,000

$1,800,000

Bond Payable

$2,700,000

$2,475,000

Required:

Prepare the journal entry to record the acquisition by Willis Inc.

Reference no: EM13540077

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