Problem 1 Paul and Co. acquired a 90% interest in Shaq & Co. for $450,000 in cash on January 1, 2019. Paul & Co. uses the simple equity method: Assets: Liabilities & Equity: Current assets $150,000 Current liabilities $75,000 Depreciable assets, net 200,000 Common Stock Retained Earnings 100,000 175,000 $350,000 $350,000 The excess of the price paid over book value is attributable to Fixed ssets which have a value of $350,000, with the balance being Goodwill. The depreciable assets have a 10 year remaining life. Paul uses the simple equity method to record its nvestment in Shaq & Co. The following trial balances of the 2 companies are prepared on December 31, 2019: Paul Current assets 25,000 Depreciable Fixed assets 240,000 Shaq 130,000 200,000 Accumulated Depreciation -96,000 Investment in Shaq & Co. 486,000 Current liabilities -60,000 -15,000 Common Stock -250,000 -100,000 Retained Earnings 1/1/19 -150,000 -175,000 Sales -1,400,000 -700,000 Expenses 1,250,000 650,000 Subsidiary Income -45,000 Dividends Declared 10,000 1 Prepare a determination and distribution of excess schedule for the investment 2 Prepare all the elimination and adjustment journal entries that would be made at December 31, 2019.