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On January 1,2024, Casey Corporation exchanged $3,262,000 cash for 100 percent of the outstanding voting...

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Accounting

On January 1,2024, Casey Corporation exchanged $3,262,000 cash for 100 percent of the outstanding voting stock of Kennedy Corporation. Casey plans to maintain Kennedy as a wholly owned subsidiary with separate legal status and accounting information systems. At the acquisition date, Casey prepared the following fair-value allocation schedule: Fair value of Kennedy (consideration transferred) $ 3,262,000 Carrying amount acquired 2,600,000 Excess fair value $ 662,000 to buildings (undervalued) $ 384,000 to licensing agreements (overvalued)(199,000)185,000 to goodwill (indefinite life) $ 477,000 Immediately after closing the transaction, Casey and Kennedy prepared the following postacquisition balance sheets from their separate financial records (credit balances in parentheses). Accounts Casey Kennedy Cash $ 423,000 $ 139,500 Accounts receivable 1,515,000305,000 Inventory 1,655,000230,500 Investment in Kennedy 3,262,0000 Buildings (net)5,820,0002,280,000 Licensing agreements 02,720,000 Good

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