01 MBC III 49. Consolidation on date of acquisition Equity method with noncontrolling interest and AAP Assume a parent company acquires a 75% interest in its subsidiary for a purchase price of $924,000. The excess of the total fair value of the controlling and noncontrolling interests over the book value of the subsidiary's Stockholders' Equity is assigned to a building (in PPE, net) that is worth $88,000 more than its book value, an unrecorded patent with a fair value of $144,000, and Goodwill of $248,000. There is no control premium, so goodwill is assigned proportionally to the controlling and noncontrolling interests. The parent and the subsidiary report the following pre-consolidation balance sheets on the acquisi- tion date: Parent Subsidiary Parent Subsidiary Cash... ............. Accounts receivable.... Inventory.. Equity investment....... Property, plant and equipment, net. ........ $ 160,000 264,000 340,000 $ 720,000 625,600 880,000 924,000 3,200,000 $6,349,600 Current liabilities. .......... Long-term liabilities. ........ Common stock ... Additional paid-in capital. .... Retained earnings ......... Total liabilities and equity .... $ 640,000 2,400,000 720,000 560,000 2,029,600 $6,349,600 $ 252,000 400,000 72,000 96,000 584,000 $1,404,000 640,000 $1,404,000 Total assets. ..................... a. b. Prepare the consolidation entries on the acquisition date. Prepare the consolidation spreadsheet on the acquisition date