3. (48 points) At the beginning of January I 2007, the financial position of company Z and B are as follows: Mareae 1,500000 300000 Payble 200 000 On January 1st 2007, Z purchased 70% of B by issuing 700,000 shares of common stock (1 dollars face value and 8 dollars market price). Note that B's PPE has a remaining life of 10 years at the purchase date, and it was overvalued (Book value higher than market value) by $500,000, Land was undervalued (Market value higher than book value) by 800,000, and patent has a remaining life of 10 years and undervalued by $1,000,000. Z also determines that B's brand name (Infinite useful life) has market value of S1,000,000. Company Z records the investment in Company B using equity method. a. What are the journal entries of Z and B to book the transactions? (2 points) b. What does the balance sheet of Company Z, and the consolidated balance sheet look like right after the purchase? Fill out the table below (note that new accounts may be created due to the consolidation) and write down the consolidation journal entries(5 points) 3. (48 points) At the beginning of January I 2007, the financial position of company Z and B are as follows: Mareae 1,500000 300000 Payble 200 000 On January 1st 2007, Z purchased 70% of B by issuing 700,000 shares of common stock (1 dollars face value and 8 dollars market price). Note that B's PPE has a remaining life of 10 years at the purchase date, and it was overvalued (Book value higher than market value) by $500,000, Land was undervalued (Market value higher than book value) by 800,000, and patent has a remaining life of 10 years and undervalued by $1,000,000. Z also determines that B's brand name (Infinite useful life) has market value of S1,000,000. Company Z records the investment in Company B using equity method. a. What are the journal entries of Z and B to book the transactions? (2 points) b. What does the balance sheet of Company Z, and the consolidated balance sheet look like right after the purchase? Fill out the table below (note that new accounts may be created due to the consolidation) and write down the consolidation journal entries(5 points)