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CLICK HERE TO REVIEW LEARNING OBJECTIVES Marked out of 35.00 QUESTION 7 Not changed since last attempt P Flag question Consolidation entries at date of acquisition (purchase price greater than book value) A parent company exchanges 10,000 shares of its $1 par value common stock, with a market value of $10Vshare, for all of the shares owned by the subsidiary's shareholders, resulting in a $100,000 total purchase price. On the acquisition date, the subsidiary reported a book value of Stockholders Equity of $75,000, comprised of $30,000 of Common Stock and $45,000 of Retained Earnings. An examination of the subsidiary's balance sheet revealed that book values were equal to fair values for al assets except for PPE (net), which has a book value of $40,000 and a fair value of $65,000. a. Prepare the entry that the parent makes to record the investment General Journal Description Debit Credit Equity investment 100,00 Common stock 0 10,00 Additional paid-in capital 0 90,00 to record the acquisition b. Prepare the [E] and [A] consolidation entries. Consolidation Worksheet Description Debit Credit [E] Common stock 100,0 Equity investment 0 100,0 Additional paid-in capital 0 25,00 to eliminate the stockholders' equity of subsidiary on the acquisition date A Equity investment 100,0 Retained earnings 0 75,00 to record the [A] assets purchased on the acquisition date