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Question 2 (45 points) Manhattan Ltd. and Hallelujah Corp. had the following balance sheets on August 31, 2021: Manhattan Hallelujah Hallelujah Ltd. Corp. Corp. (carrying

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Question 2 (45 points) Manhattan Ltd. and Hallelujah Corp. had the following balance sheets on August 31, 2021: Manhattan Hallelujah Hallelujah Ltd. Corp. Corp. (carrying value) (carrying value) (fair value) $800,000 $600,000 $600,000 $1,900,000 $128,000 $128,000 Cash Accounts Receivable Inventory $980,000 $160,000 $120,000 Plant and Equipment (net) $1,720,000 $512,000 $600,000 Trademark $40,000 $72,000 Total Assets $5,400,000 $1,440,000 Total Assets $5,400,000 $1,440,000 Accounts Payable $3,000,000 $600,000 $600,000 Bonds Payable $1,200,000 $480,000 $420,000 Common Shares $1,000,000 $120,000 Retained Earnings $200,000 $240,000 Total Liabilities and Equity $5,400,000 $1,440,000 In addition, Hallelujah Corp has a long-term contract with the government of the province where they have their head office. Manhattan engaged a business valuation consultant who provided an estimated value of the contract as of the acquisition date of $150,000. On August 31, 2021, Manhattan's date of acquisition, Manhattan Ltd. purchased 75% of Hallelujah Corp. for $800,000. Manhattan agreed to pay $500,000 cash on the acquisition date. In addition, Manhattan gave Hallelujah a $300,000 two-year promissory note paying interest at 6% annually. 6% reflects the rate of interest Manhattan would have had to pay to borrow funds at the time of the deal. On August 31, when the transaction closed, Manhattan paid the business valuation consultant $25,000, and its lawyers $15,000 for their work on the transaction. Required: Assuming the above balance sheets were prepared immediately before the acquisition, prepare Manhattan's Ltd's consolidated balance sheet on the date of acquisition using the Fair Value Enterprise Method. Manhattan valued non- controlling interest using the "Implied Value" based on the purchase price it paid for Hallelujah

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