ADVANCED ACCOUNTING UNIT 2 POST PROBLEM-SEPARATE SUBSIDIARY On June 30, 200X P paid $375.000 cash for 100% of the Common Stock of S Company, The transaction is an acquisition of wherein the acquired company is not dissolved. S Company is maintained as a separate subsidiary of P Company. It is still an entity, but in this case P Company owns all of it's stock. Following information is shown prior to acquisition being recorded: P Company Assets Liabilities and Capital Cash Inventories Plant Assets $580,000 60.000 340.000 Current Liabilities Common Stock $5PV Additional Paid in Capital Retained Earnings 90.000 100.000 200.000 590,000 $980,000 Total $980,000 Total S Company Assets Liabilities and Capital Inventories Other Assets Plant Assets 20,000 40,000 Current Liabilities Long Term Liabilities Common Stock $10 PV Additional Paid in Capital Retained Earnings $30,000 50,000 40.000 60.000 $200,000 Total $200,000 Total Differences between identifiable net assets of S Company were Inventories Plant Current Fair Value $50.000 250.000 Book Value $20.000 140.000 Difference S30.000 110,000 A. Prepare the journal entries showing the purchase B. Prepare a schedule showing the amount of goodwill from this purchase C Prepare a consolidation worksheet showing the eliminations D. Prepare a consolidated balance sheet AS OF June 30, 200X using the consolidation worksheet as a basis