On July 31, 2011, Ping Company purchased 90% of Santos Companys common stock for $2,010,000 cash. Immediately

On July 31, 2011, Ping Company purchased 90% of Santos Company’s common stock for $2,010,000 cash. Immediately after the acquisition, the two companies’ balance sheets were as follows:

Santos Company has not yet recorded the $60,000 cash advance from Ping Company. Ping Company’s accounts receivable include $20,000 due from Santos Company. Santos Company’s $100,000 note payable is payable to Ping Company. Neither company has recorded $7,000 of interest accrued on the note from January 1 to July 31. Any difference between book value and the value implied by the purchase price relates to land.

Required:
Prepare a consolidated balance sheet workpaper on July 31,2011.

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Ping Santos 150,000 300,000 Cash Accounts receivable Note receivable Inventory Advance to Santos Company Investment in Santos Company Plant and equipment (net) Land 320,000 600,000 100,000 1,840,000 60,000 2,010,000 3,000,000 90,000 $8,020,000 400,000 1,500,000 90,000 $2,440,000 Total Accounts payable Notes payable Common stock Other contributed capital Retained earnings 800,000 900,000 2,400,000 2,200,000 1,720,000 $8,020,000 140,000 100,000 900,000 680,000 620,000 2,440,000 Total