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On January 1, 2000, Pam Corporation held 2,000 shares of Sun Corporation common stock acquired at $15 per share
several years earlier. On this date, Pam issued 1.5 of its $10 par value shares for each of the other 98,000 outstanding
shares of Sun in a pooling of interests in which Sun Corporation was dissolved. Sun Corporation’s after-closing
trial balance on December 31, 1999, consisted of the following (in thousands):
Current assets $ 800
Plant and equipment—net 1,500
Liabilities $ 200
Capital stock, $5 par 500
Additional paid-in capital 1,000
Retained earnings 600
$2,300 $2,300
REQ U IRED : Prepare a journal entry (or entries) on Pam’s books to account for the pooling of interests.
(Hint: Do not forget to consider the 2,000 shares of Sun held by Pam on January 1, 2000.
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