Purchase Method Winston has the following account balances as of February 1....

Purchase Method

Winston has the following account balances as of February 1.

Arlington pays $1.4 million cash and issues 10,000 shares of its $30 par value common stock (valued at $80 per share) for all of Winston’s outstanding stock. Stock issuance costs amount to $30,000.

Prior to recording these newly issued shares, Arlington reports a Common Stock account of $900,000 and Additional Paid-In Capital of $500,000. For each of the following accounts, determine what balance would be included in a February 1 consolidation.

a. Goodwill.

b. Expenses.

c. Retained Earnings, 1/1.

d. Buildings.