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26. On January 3, 2022. Persoff Corporation acquired all of the outstanding woting stock of Sea Cliff. Inc., in exchanga for $6,000,000 in cash. Persofi

image text in transcribed 26. On January 3, 2022. Persoff Corporation acquired all of the outstanding woting stock of Sea Cliff. Inc., in exchanga for $6,000,000 in cash. Persofi elected to exercise control over Sea Cliff as a wholly owned subsidiary with an independent accounting system. Both companies have December 31 flscal year-ends. At the acquisition date, Sea Cliff's stockholders' equity was $2,500,000 including retained earnings of $1,700,000. Persoff pursued the acquisition, in part, to utilize Sea Cliff's technology and computer software. These items had fair values that differed from their values on Sea Clifrs books as follows: Sea Cliff's remaining identiflable assats and liabilities had acquisition-date book values that closely approximated fair values. Since acquisition, no assets have been impaired. During the next three years, Sea Cliff reported the following income and dividends: Decamber 31, 2024, financial statements for each company follow. Parentheses indicate credit balances. Dividends declared were paid in the same period. a. Construct Persoffs acquisition-date fair-value allocation schedule for its investment in Sea Cliff. b. Show how Persoff determined its Equity earnings in Sea Cliff balance for the year ended December 31 . 2024. c. Show how Persoff determined its December 31, 2024, Investment in Sea Cliff balance. d. Prepare a worksheet to determine the consolidated values to be reported on Persoff's financial statements

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