On February 1, 2024, Indigo Company purchased 95% of the outstanding common stock of Laura Company and 85% of the outstanding common stock of Kevin Company. Immediately before the two acquisitions, balance sheets of the three companies were as follows: Indigo Laura Kevin Cash $177,000 $ 47,000 $19,200 Accounts receivable 33,000 33,000 27,900 Notes receivable 16,000 —0— —0— Merchandise inventory 104,000 36,000 14,300 Prepaid insurance 13,900 2,300 900 Advances to Laura Company 12,500 Advances to Kevin Company 5,100 Land 254,000 46,000 14,300 Buildings (net) 118,000 26,000 18,500 Equipment (net) 40,000 12,800 3,500 Total $773,500 $203,100 $98,600 Accounts payable $28,000 $21,600 $11,200 Income taxes payable 30,700 10,900 —0— Notes payable —0— 7,000 11,200 Bonds payable 100,000 —0— —0— Common stock, $10 par value 300,000 140,000 45,500 Other contributed capital 145,000 13,400 38,000 Retained earnings (deficit) 169,800 10,200 (7,300) Total $773,500 $203,100 $98,600 The following additional information is relevant. 1. One week before the acquisitions, Indigo Company had advanced $12,500 to Laura Company and $5,100 to Kevin Company. Laura Company recorded an increase to Accounts Payable for its advance, but Kevin Company had not recorded the transaction. 2. On the date of acquisition, Indigo Company owed Laura Company $12,000 for purchases on account, and Kevin Company owed Indigo Company $3,100 and Laura Company $5,600 for such purchases. The goods purchased had all been sold to outside parties prior to acquisition. 3. Indigo Company exchanged 13,300 shares of its common stock with a fair value of $12 per share for 95% of the outstanding common stock of Laura Company. In addition, stock issue fees of $4,500 were paid in cash. The acquisition was accounted for as a purchase. 4. Indigo Company paid $52,700 cash for the 85% interest in Kevin Company. 5. 3,500 dollars of Laura Company’s notes payable and $10,200 of Kevin Company’s notes payable were payable to Indigo Company