On December 31, 20x7, PA. Inc. purchased 90 percent of S Company for 240,000 cash. The Balance Sheet of each corporation just prior to the acquisition is presented below. Additionally, book value and fair value for all of S assets and liabilities are equal, with the exception of Property, plant and equipment, whose fair value is 94,000.

Table 1. Balance sheet before acquisition

	P Company	S Company
ASSETS
Current assets
Cash	P 340,000	P 42,000
Accounts receivable (net)	120,000	90,000
Inventory	100,000	90,000
Total current assets	P 560,000	P 222,000
Noncurrent assets
Property, plant and equipment	530,000	84,000
TOTAL ASSETS	P 1,090,000	P 306,000
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Current liabilities
Accounts payable	P 140,000	P 60,000
Accruals	40,000	30,000
Total current liabilities	P 180,000	P 90,000
Noncurrent liabilities
Bonds payable	360,000
Total liabilities	P 540,000	P 90,000
Shareholders' equity
Common stock	P 200,000	P 110,000
Additional paid-in capital	40,000	16,000
Retained earnings	310,000	90,000
Total shareholders' equity	P 550,000	P 216,000
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	P 1,090,000	P 306,000

REQUIRED

1. Recording the purchase of S Company by P Company.
2. What is the implied fair value of S Company?
3. Calculate the amount of Goodwill implicit in the purchase.
4. What is the amount of non-controlling interest share in S Company at the date of acquisition?
5. What is the consolidated depreciation expense to be reflected in the consolidated income statement for 20x8 assuming a 10 year depreciation life for property, plant and equipment?
6. Prepare the necessary work paper adjusting entries on the date of purchase.
7. Prepare a consolidated Balance Sheet immediately after this acquisition on 12/31/20x7.