Mighty inc was organized to consolidate the resources of


Mighty Inc. was organized to consolidate the resources of Little Co. and Sam Co. in a business combination accounted for by the acquisition method. Mighty issued 31,000 shares of its $10 par voting stock with a fair value of $15 per share, in exchange for all the outstanding capital stock of Little and Sam. The equity accounts of Little and Sam on the date of the exchange were as follows.

Little                 Sam                 Total

Common stock, at par               $100,000           $200,000           $300,000

Additional paid-in capital           $12,500 $17,500 $30,000

Retained earnings                      $60,000 $105,000           $165,000

Subtotals                                  $172,500           $322,500           $495,000

What is the balance in Mighty's additional paid-in capital account immediately after the business combination?

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Financial Accounting: Mighty inc was organized to consolidate the resources of
Reference No:- TGS01661014

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