1. P Co. purchased 60% of the S Co. for $720,000 on 1/1/16. S Co. had $600,000 of common stock and $300,000 of retained earning on that date. The following values were determinded for the S Co. on the date of purchase. Inventory (book value) $80,000 . (fair value) $100,000 Land . (bv) $700,000 (fv)$900,000 Equipment (bv) $540,000 . (fv)$550,000 Prepare the 1/16/16 workpaper entries to eliminate the investment account and to allocate the difference between the cost and book value. 2. Referring to the problem above, if the equipment has a remaining life of 5 years, preapre the workpaper entry to allocate the difference between cost and book value for each of 12/31/16 and 12/31/17. Be sure to lable the years.