Problem 5-5 Workpaper Entries and Consolidated Financial Statements On January 1, 2004, Palmer Company acquired a 90% interest in Stevens Company at a cost of $1,000,000. At the purchase date, Stevens Company's stockholders' equity consisted of the following: Common stock $500,000 Retained earnings 190,000 An examination of Stevens Company's assets and liabilities revealed the following at the date of acquisition: Book Value Fair Value Cash $ 90,726 $ 90,726 Accounts receivable 200,000 200,000 Inventories 160,000 210,000 Equipment 300,000 390,000 Accumulated depreciation - equipment (100,000) (130,000) Land 190,000 290,000 Bonds payable (205,556) (150,000) Other 54.830 54.830 Total $ 690,000 $ 955.556 Additional Information - Date of Acquisition Stevens Company's equipment had an original life of 15 years and a remaining useful life of 10 vears. All the inventory was sold in 2004. Stevens Company purchased its bonds pavable on the