On January 1 2001, Fireboat corporation acquired 100% of CoolBoat Corporation. Fireboat corporation issued 100,000 shares of its 10$ ordinary shares with a market price of 15$ on date of acquisition's announcement and, 25$ on the date when the acquisition was completed for all of CoolBoat corporation ordinary shares.

The fair value of CoolCoat corporation assets and liabilities equalled their respective fair value except for PPE exceeded its fair value by 100,000. The fair value of Coolboat corporation identifiable intangibles were 200,000 which will be amortized for 5 years. For the year ended 31st december 2001, CoolBoat corporation net income was 250,000 and paid cash dividend of 150,000. The equity section of both of the corporations at december 2001 was:-

Fire Boat = 5,000,000 ordinary shares + 1,000,000 share premium + 3,000,000 retained earning = 9,000,000

Cool Boat = 1,000,000 ordinary shares + 400,000 share premium + 500,000 retained earning = 1,900,000

Requirement = advice on how this should be accounted for. apply the acquisition method.