Pierce Corporation acquires all the voting stock of Stick Company for $100 million in cash. Sticks equity accounts at the date of acquisition total $20 million, consisting of the following:

Capital stock $ 5 million

Retained earnings.. 15 million

Sticks assets and liabilities are reported at amounts approximating fair value, except its plant assets are undervalued by $8 million. It has no unreported identifiable intangible assets.

Required

Prepare eliminating entries (E) and (R) for the consolidation working paper at the date of acquisition.