On January 1, 2010, P Company purchased an 80% interest in S Company for $900,000. At that time, S Company had capital stock of $600,000 and retained earnings of $100,000. Differences between the fair value and the book value of the identifiable assets of Salem Company were as follows: Fair Value in Excess of Book Value Equipment $ 180,000 Land 20,000 Inventory 20,000 The book values of all other assets and liabilities of S Company were equal to their fair values on January 1, 2010. The equipment had a remaining life of five years. The inventory was sold in 2010. S Companys net income and dividends declared in 2010 Net Income of $120,000; Dividends Declared of $30,000.

Prepare W/P to allocate differences (all inventory has been sold), and the extra depreciation entry