Question 1(6 points) P Corporation acquired 80% of H Co. on January 1, 2015 for $420,000 cash when I's stockholders' equity consisted of $300,000 of Common Stock and $100,000 of Retained Earnings. The difference between the price paid by P and the underlying equity acquired in H was due to a $25,000 undervaluation of H's inventory, a $50,000 undervaluation of H's Property, Plant and Equipment (PPE) and goodwill. The separate company statements for P and H appear in the first two columns of the partially completed consolidation working papers. The undervalued inventory was sold by H during 2015, and the undervalued PPE had a remaining useful life of 5 years. Howed P. $8,000 on account payable at December 31, 2015... Required: A- Complete the consolidation working papers for P and H for the year 2015. "Show the steps of your calculations and entries" Consolidated Balance Sheet Working Papers at December 31, 2015 Eliminations P H Debit Credit INCOME STATEMENT Sales $ 400,000 $220,000 Consolidated Income from H. Cost of Sales Depreciation expense Other Expenses 36,000 (160,000) (80,000) (80,000) (40,000) (51,000) (20,000) Net income Retained Earnings 1/1 Add: Net income 145,000 80,000 150,000 100,000 80,000 (80,000) (40,000) $ Less: Dividends Retained Earnings 31/12 BALANCE SHEET Cash 215.000 $140.000 60,000 59,000 56,000 80,000 Accounts Receivable-net Dividend Receivables 16.000 80,000 Inventories 60,000 Land 30,000 530.000 424,000 60,000 340.000 PPE Investment in H Co. TOTAL ASSETS Accounts payable Dividend Payable Other payables Capital Stock $1,195,000 600,000 80,000 100,000 200,000 20,000 100,000 40,000 600,000 300,000 Retained Earnings 31/12 215,000 140,000 TOTAL LIAB. & EQUITY $ 1,195,000 600,000