Constructing the Consolidated Balance Sheet at Acquisition Easton Company acquires 100 percent of the outstanding voting shares of Harris Company on January 1, 2016. To obtain these shares, Easton pays $210,000 in cash and issues 5,000 of its $10 par value common stock. On this date, Eastons stock has a fair value of $36 per share, and Harriss book value of stockholders equity is $280,000. Easton is willing to pay $390,000 for a company with a book value for equity of $280,000 because it believes that (1) Harris buildings are undervalued by $40,000, and (2) Harris has an unrecorded patent that Easton values at $30,000. Easton considers the remaining balance sheet items to be fairly valued (no book-to-fair value difference). The remaining $40,000 of the purchase price excess over book value is ascribed to corporate synergies and other general unidentifiable intangible assets (goodwill). The January 1, 2016, balance sheets at the acquisition date follow:

Easton Company Harris Company $40,000 90,000 130,000 Cash Receivables Inventory Investment in Harris Land Buildings, net Equipment, net Total assets $84,000 160,000 220,000 390,000 100,000 400,000 120,000 $1,474,000 60,000 110,000 50,000 $480,000 Accounts payable Long-term liabilities Common stock Additional paid-in capital Retained earnings $160,000 380,000 500,000 74,000 360,000 $1,474,000 $30,000 170,000 40,000 240,000 $480,000 Total liabilities & equity a. Show the breakdown of the investment into the book value acquired, the excess of fair value over book value, and the portion of the investment representing goodwill Do not use negative signs with your answers. Cash paid 84,000 Fair market value of shares issued Purchase price Less: Book value of Harris Excess payment Excess payment assigned to specific accounts based on fair market value Buidlings Patent Goodwill