Axel Corporation acquires 100% of the stock of Wheal Company on December 31, Year 4. The following information pertains to Wheal Company on the date of acquisition: CASE 5-1 Accounting Entries for Consolidation of Book Value Fair Value Intercorporate Investments $40,000 60,000 50,000 $40,000 55,000 75,000 200,000 30,000 Cash Accounts receivable. Inventory Property, plant, and equipment (net) Secret formula (patent). 100,000 Total assets $250,000 $400,000 $ 30,000 22,000 38,000 Accounts payable Accrued employee pensions. Long-term debt Capital stock.. Other contributed capital Retained earnings.. 30,000 20,000 40,000 100,000 25,000 35,000 Total liabilities and equity. $250,000 $90,000 Axel Corporation issues $110,000 par value ($350,000 market value on December 31, Year 4) of its own stock to the shareholders of Wheal Company to consummate the transaction, and Wheal Company becomes a wholly owned, consolidated subsidiary of Axel Corporation. Required a. Prepare journal entries for Axel Corp. to record the acquisition of Wheal Company stock assuming purchase accounting. b. Prepare the worksheet entries for Axel Corp. to eliminate the investment in Wheal Company stock in preparation for a consolidated balance sheet at December 31, Year 4, assuming (1) pooling accounting and (2) purchase accounting CK (b) Cr. Investment in Wheal for $110,000 in (1), and $350,000 total in (2) c. Calculate consolidated retained earnings at December 31, Year 4 (Axel's retained earnings at this date are $150,000), assuming: (1) Axel Corp. uses the pooling method for this business combination. (2) Axel Corp. uses the purchase method for acquisition of Wheal Company