Potluck Corp. acquired all of the stock of Sauers Corp. on June 30, 2022, in an acquisition reported as a stock acquisition. Sauers trial balance at the date of acquisition, along with the fair values of its assets and liabilities, are:

Book Value Dr (Cr)Fair Value Dr (Cr)Tangible assets$48,000,000$20,000,000Intangible assets12,000,00072,000,000Liabilities(44,800,000)(44,000,000)Capital stock(8,000,000) Retained earnings(7,120,000) Accumulated other comprehensive income(80,000) Total$0

Potluck pays $72 million in cash and issues 1,200,000 shares of stock to the former owners of Sauers. Potlucks stock has a par value of $0.01 /share. The market price of the shares at the date of acquisition, $28 /share, is used to value the shares issued. Registration fees for the stock are $400,000 and legal and consulting fees connected with the acquisition are $480,000, both paid in cash.

Required

Note: Enter all zeros with your numerical answers, do not abbreviate your answers in thousands or in millions.

a. Prepare the journal entry Potluck made to record the stock acquisition on its own books on June 30, 2022.

b. Prepare working paper eliminating entries (E) and (R) to combine the accounts of Potluck and Sauers at June 30, 2022.

Required Note: Enter all zeros with your numerical answers, do not abbreviate your answers in thousands or in millions. a. Prepare the journal entry Potluck made to record the stock acquisition on its own books on June 30, 2022