2. Equity Investments (14 points) Falcon, Inc. purchased 35% of Buffalo, Co.'s outstanding common stock by issuing Falcon's common stock worth $150,000 (the total par value of issued shares was $5,000) and paying $40,000 in cash on December 31, 2017 to some outstanding shareholders of Buffalo Co. Below is the balance sheet for Buffalo (and the fair value of Buffalo's assets and liabilities) on 12/31/17: BUFFALO, CO BALANCE SHEET ON 12/31/17 Book Value Cash $ 120,000 Accounts Receivable (net) 70,000 Inventory 80,000 Land 100,000 PP&E 420,000 Accumulated Depreciation (60,000) Patent Total $730.000 Fair Value 120,000 70,000 75,000 70,000 395,000 20,000 Current Liabilities Long-term debt $ 60,000 160,000 60,000 160,000 100,000 200,000 Common stock APIC Retained earnings Total 210,000 $730.000 Buffalo reported net income of $60,000 in net income and declared and paid $30,000 in dividends. Required: a) Make Falcon's journal entry to record the acquisition on 12/31/17 and determine the implied goodwill in the acquisition (5 pts) b) Make all Falcon's required journal entries for 2018, assuming the differential related to Inventory will clear in 2018 (FIFO), the estimated remaining economic life of the depreciable assets is ten years, and the economic life of the patent is five years. (9 pts)