QUESTION 12 Chad Company obtains 100 percent of Abe Company's stock on January 1, 2017 As of that date. Abe has the following trial balance Croce Cash and short term investments Accounts receivable Inventory Supplies Buildings (not) (4-year remaining life) Equipment (net) (5-year remaining life) Land Accounts payable Long term liabilities (mature 12/31/20) Common stock Retained earnings, 1/1/17 Additional paid in capital Totals Debil 00 000 540,000 90,000 10,000 120,000 200.000 80 000 $50,000 150 000 250,000 100 000 50 000 $600 000 $600,000 During 2017, Abe reported net income of $80,000 while declaring and paying dividends of $10,000 Duning 2018. Abo reported net income of $110.000 wale dedaning and paying dividends of $30,000. Assume that Chid acquired Abe's common stock for $400,000 in cash As of January 1, 2017 Abo's land had a fair value of 500,000 is buildings were valued at $160,000, and its equipment was appraised at $180 000 After the acquisition Abe Company will remain as a standalone subsidiary Chad has control over Abe Company after the acquisition Chad uses the equity method to account for its investment when consolidating Chad Company wants to prepare consolidated financial statements at the acquisition dale Item A What is Consolidation Entry A at January 1, 2017 (the acquisition date) Place "Hem A' in front of your typed answer. Answer should include amount and show work for partial credit 10 points) Bi 2 Arial 3 (12pt) T.EE QUESTION 12 Chad Company obairs 100 percent of Abo Company's stock on January 1, 2017 As of that solo. Abo has the following trial balance Debar Cro cash and short form investments 60.000 Accounts rocovable $40.000 Inventory 90,000 Suppos 10,000 Buildings (b) (4 your remaining ho) 120.000 Equipment (not) (5 year romaning to 200,000 Land Accounts payable 550,000 long form habilities (mature 12/31/20) 150.000 Common stock 250.000 | | | | | | | | | | 100 000 Actional paid in capital 50,000 Total $600,000 5000,000 30.000 During 2017 Abo reported net income of 500 000 who decling and paying dividends of $10,000. During 2018 Abo reported not income of $110,000 whole daching and you dividends of $30,000. Assume that Chad acquired Abe's common stock for $490 000 inash As of Minusy 1 2017 Aboy and had a fait value of 500,000, sbulding wore valued at $100,000, and its equipment was appraised at $180.000. After the acquisition Abo Company wil roman as a standalone day Chid has control over Abe Company for the acquisition Chad uses the equity method to account for its investment when consolidating Chad Company wants to propone consolidated financial statements at the acquisition dato tom A What is Consolidation Entry A at January 1, 2017 (the acquisition date) Place tom in front of your typed answer. Answer should includes amount and show work for partial credit 10 points) T TT A T