Question 1 (9 marks) The balance sheets of Parent and Sub on December 30, year 6 are as follows: Parent Ltd. Sub Ltd. $19,500 Cash and receivables Inventory Plant assets (net) Intangible Assets Current Liabilities Long Term Debt Common Stock Retained Earnings (deficit) $96,000 57,000 9,000 228,000 70,500 24,000 6,000 $405,000 $105,000 $63,000 $30,000 97,500 45,000 153,000 46,500 91,500 (16,500) $405,000 $105,000 On December 31, Year 6, Parent issued 350 shares with a fair value of $40 per share for 70% of the outstanding shares of Sub. Costs of $1,600 were incurred and paid in cash for issuing the shares. Costs of arranging the acquisition (legal and accounting costs) were $2,500. The book values of Sub's net assets were equal to their fair values on this date except for those below: Plant Assets Long Term Debt Parent was identified as the clear acquirer. Required: Fair Value $65,000 $40,000 Assume that Parent prepares consolidated statements under the identifiable net asset (also known as parent company extension) theory. a) Prepare a schedule to show the calculation of the acquisition differential, goodwill and non-controlling interest on the balance sheet at acquisition date, December 31, year 6. (6 marks) b) Calculate the value of common shares on the consolidated balance sheet at December 31, year 6. (3 marks)