46. Consolidation at date of acquisition (purchase price greater than book value) Assume that the parent company acquires its subsidiary by exchanging 70,000 shares of its Common Stock, with a market value on the acquisition date of $25 per share, for all of the outstanding voting shares of the investee. In its analysis of the investee company, the parent values all of the subsidiary's assets and liabilities at an amount equaling their book values except for an unrecorded Patent owned by the subsidiary that the parent values at $200,000. Any further discrepancy between the purchase price and the book value of the subsidiary's Stockholders' Equity is attributed to expected synergies to be realized by the consolidated company as a result of the acquisition. a. What is the total fair value of the subsidiary on the acquisition date? b. Prepare the consolidation entry or entries on the date of acquisition given the following balance sheets of the parent and subsidiary on the date of acquisition. Parent Subsidiary Balance Sheet Assets Cash.. Accounts receivable. Inventory Equity investment. Property, plant and equipment (PPE), net. $ 226,000 348,000 447,000 $ 3,082,500 1,280,000 1,940,000 1,750,000 9,332,000 $17,384,500 827,000 $1,848,000 Liabilities and stockholders' equity Accounts payable. Accrued liabilities Long-term liabilities Common stock. APIC... Retained earnings $ 627,000 736,000 3,000,000 2,397,500 5,600,000 5,024,000 $ 127,000 221,000 500,000 100,000 125,000 775,000 $1,848,000 $17,384,500 c. d. Prepare the consolidated balance sheet on the date of acquisition. What additional assets have been recognized on the consolidated balance sheet that were not explicitly reported on the balance sheets of either the parent or the subsidiary? Where were they