Problem II Parent Sale of Subsidiary Shares to NC1 (35 points) Paris Company purchases a 90% interest in Seville Company for S4 18.500 on January 1, 2013. Any excess is attributed to equipment, which has a 20 year useful life On Septmeber 1, 2016, Paris sells 8,000 shares of Seville for $700,000. The following stockholder's equity of Seville are as follows: January 1, 2013 January 1,2016 Common Stock ($10 par) Retained earnings S 100,000 $ 100,000 420,000 250,000 350,000 S Total equity 520,000 Assume Seville Company earns net income of $70,000 evenly during 2016. Required: 1. Prepare the journal entry to account for the sale of Seville Company on 9/1/2016. Suppose Paris sold S2,000 shares instead for $120,000. Prepare the journal entry for this sale. 2. 3. Suppose instead if selling shares Paris purchases 1,000 additional shares of Seville for $70,000 on 9/1/16. Prepare the analysis and necessary journal entry to account for the purchase of additional shares. (Note: these are shares purchased from the NCI, not newly-issued shares from Seville, there is a difference). Problem III: Subsidary Sale of New Shares to Pareat and NCI (45 pointst On January 1, 2015, Alliance Company purchased S0% of Beta when Beta had the following equity: Common stock ($10 par) Retained earnings 500,000 300,000 s 800,000 Assume the only excess was goodwill of ss0,000 and that Beta had net income of $60,000 for 2015. On January 1, 2016, Beta issued 30,000 new shares of stock @ $22 per share. Prepare the necessary adjusting journal entry on Alliance's books to account for the issuance of the new shares under the following conditions: Required: 1. Prepare the necessary adjusting journal entry on Alliance's books assuming that Alliance 2. Prepare the necessary adjusting journal entry on Alliance's books assuming that Alliance 3. Prepare the necessary adjusting journal entry on Alliance's books assuming that Alliance purchases 15,000 of the newly-issued shares. purchases 20,000 of the newly-issued shares. doesn't purchase any of the newly-issued shares. Assume Beta declares a 20% stock dividend in 2016 when the market price of the stock was selling at $24 per share. Prepare the necessary journal entry to account for the stock dividend on Beta's books