Consolidation entries at date of acquisition (purchase price greater than book value) A parent company exchanges 2,500 shares of its 51 par value common stock, with a market value of $10/share, for all of the shares owned by the subsidiary's shareholders, resulting in a $25,000 total purchase price. On the acquisition date, the subsidiary reported a book value of Stockholders' Equity of $18,750, comprised of $7,500 of Common Stock and $11,250 of Retained Earnings. An examination of the subsidiary's balance sheet revealed that book values were equal to fair values for all assets except for PPE (net), which has a book value of $10,000 and a fair value of $16,250. a. Prepare the entry that the parent makes to record the investment. General Journal Description Debit Credit Equity investment 25000 Common stock Additional paid-in capital b. Prepare the [E] and [A] consolidation entries. Consolidation Worksheet Description E Common stock Debit Credit to eliminate the stockholders' equity of subsidiary on the acquisition date [A] to record the [A] assets purchased on the acquisition date