QUESTION 14 Please use the following question to answer questions 14-20: On January 1, 2010, P Company purchased an 80% interest in s Company for $900,000. At that time, S Company had capital stock of $600,000 and retained earnings of $100,000. Differences between the fair value and the book value of the identifiable assets of Salem Company were as follows: Fair Value in Excess of Book Value Equipment $ Land 180,000 20,000 20,000 Inventory The book values of all other assets and liabilities of S Company were equal to their fair values on January 1, 2010. The equipment had a remaining life of five years. The inventory was sold in 2010. s Company's net income and dividends declared in 2010 Net Income of $120,000; Dividends Declared of $30,000 Prepare W/P to allocate the differences (see above question) QUESTION 14 Please use the following question to answer questions 14-20: On January 1, 2010, P Company purchased an 80% interest in s Company for $900,000. At that time, S Company had capital stock of $600,000 and retained earnings of $100,000. Differences between the fair value and the book value of the identifiable assets of Salem Company were as follows: Fair Value in Excess of Book Value Equipment $ Land 180,000 20,000 20,000 Inventory The book values of all other assets and liabilities of S Company were equal to their fair values on January 1, 2010. The equipment had a remaining life of five years. The inventory was sold in 2010. s Company's net income and dividends declared in 2010 Net Income of $120,000; Dividends Declared of $30,000 Prepare W/P to allocate the differences (see above question)