Danon Enterprises, [DNE] is a publicly traded corporation. On January 1, 2016, it acquired 100% of the voting shares of Luppa Places, [LPL]. The balance sheet of LPL on December 31, 2015, was as follows:

	Book Value	Fair vALUE
CASH	45K	45K
A/R	110K	90K
INVENTORY	280K	330K
LAND	310K	380K
DEPRECIATION ASSETS NET	460K	470k
Total assets	1205000
Current Liabilities	225k	225k
Common Shares	400k
Retained earnings	550k

Additional Info

The inventory was sold and the accounts receivable collected within six months after acquisition. The depreciable assets are be depreciated over 10 years, straight line, with no salvage value.

Both companies paid income tax at an average rate of 32%.

During 2018, LPL sold inventory to DNE for $150,000 with a 20% gross margin. At the end of

2018, $30,000 of these goods were still in the DNE inventory. All of these goods remaining in

inventory were sold during 2019.

During 2019, LPL sold goods to DNE for $220,000 with a 20% gross margin, and $60,000 of these

were still in the DNE inventory at the end of 2019.

On January 1, 2017 DNE sold a tract of land, located in Windsor to LPL for $100,000 and which

was carried in the books of DNE for $80,000.

During 2019, both companies declared and paid dividends equal to 10% of their common share

value.

LPL sold a commercial building located in Toronto to DNE, on January 1, 2018 for $200,000 and

which was carried in the books of LPL for $120,000. The building had a remaining useful life of 5

years on the day of sale. H. DNE received $22,000 as rent for properties it has leased to LPL.

Balance Sheet as at dec 31, 2019

	DNE	LPL
CASH	55K	140K
A/R	140K	115K
NOTES RECIVABLE		90K
INVENTORY	400k	320k
land	670k	385k
Depreciable assets net	864k	520k
Investment in LPL at cost	669k
Other investments	100k
Total Assets	2898000	1570000
Current lIABILITIES	98K	175K
NOTES PAYABLE	90K
COMMON SHARES	550K	400K
R/E	2160000	995000
tOTAL EQUITITIES	289800	1570000

ICOME ST YEAR END DEC 31, 2019

	DNE	LPL
SALES REVS	809K	789K
INVESTMENT AND DIVS REVS	40K
RENT REVS	42K
TOTAL REVS	891K	789K
LESS EXPENSES;
COGS	542K	457K
DEPRICIATION	120K	110K
RENT EXPENSE		22K
INCOME TAX EXPENSE	80K	70K
TOTAL EXPENSES	742K	681K
NI	149	130K

REQUIRED:

Calculate the acquisition analysis

Prepare the FVA adjustment table for the year ended December 31, 2019

Prepare the consolidated Income Statement for the year ended December 31, 2019.

Calculate the balances in the following Consolidated Balance sheet accounts as at December 31,

2019:

i) Retained earnings

ii) Plant and equipment (net) iii) Deferred Taxes separate the assets and liabilities.