Part A: On January 1, 2018, Callahan Company paid $1,600,000 to acquire Serrano Corporation, which became the Serrano Division of Callahan Company. Serrano Corporation's balance sheet at the time of the acquisition showed: S 450,000 Accounts Receivable 350,000 250,000 750,000 Accounts Payable Notes Payable s 200,000 250,000 1350,000 $1.800.000 Equipment (net) Building (net) Stockholders equity Total liabilities and Total assets $1.800.000 stockholders' equity At the date of the purchase it was determined that the carrying value of the assets and liabilities of Serrano were equal to their fair values except that the Building was undervalued by $100,000. REQUIRED: Prepare the journal entry on January 1 , 2018 to record the purchase of Serrano Division. Part B: At December 31, 2019, the Serrano Division reports the following balance sheet information: Cash Accounts Receivable Equipment (net) Building (net) Goodwill 350,000 250,000 200,000 775,000 (For Goodwill, use the amount you calculated from Part A 400,000 350,000 Accounts Payable Notes Payable It is determined that the fair value of the Serrano Division is $1,175,000. The recorded amount for Serrano Division's assets and liabilities are the same as fair value, except for Equipment, which has a fair value of $25,000 above the carrying value