QUESTION 1. In a cash transaction, Taylor Company purchased 90 percent of the outstanding stock of Schumacher Company for $763,200 on June 30, 20xx. Directly after the acquisition, sepa- rate balance sheets of the companies appeared as follows: Taylor Company Schumacher Company $ 48,000 240,000 520,000 Assets Cash Accounts Receivable Inventory Investment in Schumacher Company Plant and Equipment (net) Other Assets Total Assets $ 400,000 650,000 1,000,000 763,200 1,500,000 50,000 $4,363,200 880,000 160,000 $1,848,000 Liabilities and Stockholders' Equity Accounts Payable $ 800,000 Long-Term Debt 1,000,000 Common Stock, $5 par value 2,000,000 Retained Earnings 563,200 Total Liabilities and Stockholders' Equity $4,363,200 $ 400,000 600,000 800,000 48,000 $1,848,000