5. Topic: Bargain purchase P purchased all the outstanding shares of S for $1,300,000 when the underlying book value of S was $1,200,000. S's assets and liabilities consist of the following:

Fair value Book value

Cash, receivables $250,000 $250,000 Inventory 360,000 380,000 Equipment 900,000 600,000 Liabilities 30,000 30,000

The gain on acquisition is: a. $140,000 b. $180,000 c. $220,000 d. $260,000

**Please provide explanation and any calculations. Thank you!