2. Balance Sheet for Mergers,,Consider the following premerger information about Firm X and Firm Y:,, Firm X Firm Y,,Total earnings $50,000 $29,000,Shares outstanding 26,000 20,000,Per-share values:,Market $53 $19,Book $21 $9,,Assume that Firm X acquires Firm Y by paying cash for all the shares outstanding at a merger premium of $5 per share. Assuming that neither firm has any debt before or after the merger, construct the post merger balance sheet for Firm X assuming the use of:,(a) Pooling of interests accounting methods and,(b) Purchase accounting methods.,
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