Condensed balance sheets for Rich Company and Jordan Company on January 1, 2016 are as follows:

Rich

Jordan

Current Assets

$ 440,000

$200,000

Plant and Equipment (net)

1,080,000

340,000

Total Assets

$1,520,000

$540,000

Total Liabilities

$ 230,000

$ 80,000

Common Stock, $10 par value

840,000

240,000

Other Contributed Capital

300,000

130,000

Retained Earnings

150,000

90,000

Total Equities

$1,520,000

$540,000

On January 1, 2016 the stockholders of Rich and Jordan agreed to a consolidation whereby a new corporation, Cannon Company, would be formed to consolidate Rich and Jordan. Cannon Company issued 70,000 shares of its $20 par value common stock for the net assets of Rich and Jordan. On the date of consolidation, the fair values of Rich's and Jordan's current assets and liabilities were equal to their book values. The fair value of plant and equipment for each company was: Rich, $1,270,000; Jordan, $360,000.

An investment banking house estimated that the fair value of Cannon Company's common stock was $35 per share. Rich will incur $45,000 of direct acquisition costs and $15,000 in stock issue costs.

Required:

Prepare the journal entries to record the consolidation on the books of Cannon Company assuming that the consolidation is accounted for as an acquisition.