question jaynes inc acquired all of aaron co 39 s common stock on january1 2012 by i 4279131
Jaynes Inc. acquired all of Aaron Co.'s common stock on January1, 2012, by issuing 11,000 shares of $1 par value common stock.Jaynes' shares had a $17 per share fair value. On that date, Aaronreported a net book value of $120,000. However, its equipment (witha five-year remaining life) was undervalued by $6,000 in thecompany's accounting records. Any excess of considerationtransferred over fair value of assets and liabilities is assignedto an unrecorded patent to be amortized over ten years.
What balance would Jaynes' Investment in Aaron Co. accounthave shown on December 31, 2012, when the equity method was appliedfor this acquisition?
An allocation of the acquisition value (based on the fair valueof the shares issued) must first be made.