Problem 4-6 LO2, 3, 4 The balance sheets of E Ltd. and J Ltd. on December 30, Year 6, were as follows: E Ltd. Ltd. Cash and receivables Inventory Plant assets (net) Intangible assets $ 96,000 57,000 228,000 24,000 $405,000 $ 19,500 9,000 70.500 6.000 $105.000 CHAPTER 4 Consolidation of Non-Wholly Owned Subsidiaries Current liabilities Long-term debt Common shares Retained earnings (deficit) $ 63.000 97.500 153,000 91,500 $405,000 $ 30,000 45.000 46,500 (16,500) $105,000 On December 31, Year 6, E Ltd. issued 350 shares, with a fair value of $40 each, for 70% of the outstanding shares of J Ltd. Costs involved in the acquisition, paid in cash, were as follows: Costs of arranging the acquisition Costs of issuing shares $2.500 1,600 $4,100 The carrying amounts of J Ltd.'s net assets were equal to fair values on this date except for the following Fair Value Plant assets $65,000 40,000 Long-term debt E Ltd. was identified as the acquirer in the combination. Required (a) Prepare the consolidated balance sheet of E Ltd. on December 31, Year 6, under the identifiable net assets method. (b) Prepare the consolidated balance sheet of E Ltd. on December 31, Year 6, under the fair value enterprise method. Problem 4-6 LO2, 3, 4 The balance sheets of E Ltd. and J Ltd. on December 30, Year 6, were as follows: E Ltd. Ltd. Cash and receivables Inventory Plant assets (net) Intangible assets $ 96,000 57,000 228,000 24,000 $405,000 $ 19,500 9,000 70.500 6.000 $105.000 CHAPTER 4 Consolidation of Non-Wholly Owned Subsidiaries Current liabilities Long-term debt Common shares Retained earnings (deficit) $ 63.000 97.500 153,000 91,500 $405,000 $ 30,000 45.000 46,500 (16,500) $105,000 On December 31, Year 6, E Ltd. issued 350 shares, with a fair value of $40 each, for 70% of the outstanding shares of J Ltd. Costs involved in the acquisition, paid in cash, were as follows: Costs of arranging the acquisition Costs of issuing shares $2.500 1,600 $4,100 The carrying amounts of J Ltd.'s net assets were equal to fair values on this date except for the following Fair Value Plant assets $65,000 40,000 Long-term debt E Ltd. was identified as the acquirer in the combination. Required (a) Prepare the consolidated balance sheet of E Ltd. on December 31, Year 6, under the identifiable net assets method. (b) Prepare the consolidated balance sheet of E Ltd. on December 31, Year 6, under the fair value enterprise method