Intercompany Items, Two Subsidiaries On February 1, 2004, Punto Company purchased 95% of the outstanding common stock of Sara Company and 85% of the outstanding common stock of Rob Company. Immediately before the two acquisitions, balance sheets of the three companies were as follows: LO7 Punto Sara Rob Cash $165,000 $ 45,000 $ 17,000 Accounts Receivable 35,000 35,000 26,000 Notes Receivable 18,000 —0— —)—
Merchandise Inventory 106,000 35,500 14,000.
Prepaid Insurance 13,500 2,500 500.
Advances to Sara Company 10,000 Advances to Rob Company 5,000 Land 248,000 43,000 15,000 Buildings (net) 100,000 27,000 16,000 Equipment (net) 35,000 10,000 2,500 Total $735,500 $198,000 $ 91,000 Accounts Payable $ 25,500 $ 20,000 $ 10,500 Income Taxes Payable 30,000 10,000 —0—
Notes Payable —J)— 6,000 10,500 Bonds Payable 100,000 —J0— —0—
Common Stock, $10 par value 300,000 144,000 42.000 Other Contributed Capital 150,000 12,000 38,000 Retained Earnings (Deficit) 130,000 6,000 (10,000)
Total $735,500 $198,000 $91,000.

The following additional information is relevant.
1. One week before the acquisitions, Punto Company had advanced $10,000 to Sara Company and $5,000 to Rob Company. Sara Company recorded an increase to Accounts Payable for its advance, but Rob Company had not recorded the transaction.
2. On the date of acquisition, Punto Company owed Sara Company $12,000 for purchases on account, and Rob Company owed Punto Company $3,000 and Sara Company $6,000 for such purchases. The goods purchased had all been sold to outside parties prior to acquisition.
3. Punto Company exchanged 13,400 shares of its common stock with a fair value of $12 per share for 95% of the outstanding common stock of Sara Company. In addition, stock issue fees of $4,000 were paid in cash. The acquisition was accounted for as a purchase.
4. Punto Company paid $50,000 cash for the 85% interest in Rob Company.
5. Three thousand dollars of Sara Company’s notes payable and $9,500 of Rob Company’s notes payable were payable to Punto Company.
6. Any difference between cost and book value relates to subsidiary land.
Required:
A. Give the book entries to record the two acquisitions in the accounts of Punto Company.
B. Prepare a consolidated balance sheet workpaper immediately after acquisition.
C. Prepare a consolidated balance sheet at the date of acquisition for Punto Company and its subsidiaries.