Problem 1 You have been given the following information for Ethan Company as of June 1, 2010. Problem 2 On April 25, 2010, Bullseye Company purchased all of the outstanding common stock of Vista Company, paying $14,000,000.

Problem 1    You have been given the following information for Ethan Company as of June 1, 2010. Ethan Company purchased a parcel of land and then incurred specific costs for the construction of a new building. Below is a list of these costs:

Cost of Parking Lot and gates -------- 14,000

Cost of filling the building site -------- $10,000

Legal Fees to buy land -----------------   $2,000

Cost of driveway --------------------------- $9,000

Property Taxes for Jan 1,2010 to June 1, 2010  ---------------  $5,000

Title Insurance ------------------             $2,000

Interest on the construction loan --------- $13,000

Proceeds from the sale of salvage materials ----------------  ($1500)

Purchase price of land ----------------------- $200,000

Cost of the building construction ----------- $650,000

Cost of razing building on lot ------------------- $9,500

Cost of grading the lot ----------------------------- $5,000

Required:

1.  Using Excel, determine the accounts that are affected by the above transactions and the final balance of each account. (Note: The interest on the construction loan will be applied to the cost of the land.)

2.   Please prepare your solution in an Excel file.

Problem 2   On April 25, 2010, Bullseye Company purchased all of the outstanding common stock of Vista Company, paying $14,000,000. The book values and fair values of Vista's assets and liabilities acquired are shown below in dollar amounts:

Accounts                                     Book Value       Fair Value

Accounts Receivables             $1,900,000       $1,725,000

Inventories                                     $2,800,000       $4,000,000

Accounts Payable                      $2,000,000       $2,000,000

Property, Plant and Equipment      $8,000,000       $12,625,000

Bonds Payable                                $4,600,000$4,225,000

Required:

1.  Using Excel, prepare the journal entry to record the acquisition by Bullseye Company. 

2.  Submit your solution in same Excel file as for Problem 1.