6. Pinoy Company acquired all the stock of Schell Company by issuing 1,000,000 shares of $0.50 par stock with a market value of $30 per share. Registration fees were $250,000 and legal fees were $150,000, all paid in cash. Pinoy also made cash severance payments of $1,800,000 to Schell's former employees, and promised payments to former owners of Schell, who are now employees of Pinoy, with an expected present value of $2,000,000. These payments will be terminated if the employee is no longer employed by Pinoy. Schell's book value at the date of acquisition was $2,000,000, consisting of $600,000 in capital stock and $1,400,000 in retained earnings. All of Schell's assets and liabilities are carried at amounts approximating fair value, except that long-term debt is overvalued by $200,000, and plant assets are overvalued by $5,000,000. Schell also has unreported in-process research & development, capitalizable per GAAP, valued at $20,000,000, and an unreported pending lawsuit, in which it is the defendant, valued at $2,800,000 and reportable per GAAP. est Required Prepare Pinoy's entry to record the acquisition of Schell. b. a. Prepare the necessary consolidation working paper eliminating entries (E) and (R) to consolidate the balance sheets of Pinoy and Schell at the date of acquisition. ollaleds