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On December 31, Year 1. P Company purchased 80% of the outstanding shares of $ Company for $7,900 cash. The statements of financial position of the two companies immediately after the acquisition transaction appear below. P Company $ Company Carrying Amount Carrying Amount Fair Value Plant and equipment (net) $ 9.600 $ 8,300 $7.000 Investment in S Company 7,900 Inventory 6,660 5,300 5.500 Accounts receivable 6.150 3,300 3.300 Cash 4.500 2.550 2.550 $34.810 $19.450 Ordinary shares $12,000 $ 4.500 Retained earnings 15.410 5.950 Long-term liabilities 4.500 3.500 3.500 Other current liabilities 1.500 3.300 3.300 Accounts payable 1.400 2.200 2.200 $34.810 $19.450 Page 199 Required (a) Calculate consolidated goodwill at the date of acquisition under the proportionate consolidation method. (b) Prepare a consolidated statement of financial position at the date of acquisition under each of the following: (i) identifiable net assets method (ii) fair value enterprise method (c) Calculate the current ratio and debt-to-equity ratio for P Company under the two methods. Explain which method shows the strongest liquidity and solvency position and which method best reflects the true financial condition of the company