3. Consolidated Balance Sheet with Majority-Owned Subsidiary Assume that on January 1, 20X1, Peerless Products Corporation acquires 80 percent of the common stock of Special Foods Inc. for $310,000. At that date, the fair value of the noncontrolling interest is estimated to be $77,500. The balance sheets of Peerless and Special Foods immediately after acquisition are shown as below: Peerless Products Special Foods Special Foods' Fair Fair Value Value Increment $ 40,000 75.000 100.000 175.000 550.000 50.000 60.000 10.000 $65.000 50,000 360,000 $5.000 10.000 60,000 300.000 500.000 10.00 300.000 Assets Cash Accounts Receivable Inventory Land Bulldings & Equipment Accumulated Depreciation Net took Value Investment in Special Foods Stock Total Assets Liabilities & Stockholders' Equity Accounts Payable Bonds Payable Common Stock Retained Earnings Total Liabilities & Equity 400,000 310.000 51.100.000 S475.000 S25.000 $ 100,000 200.000 500.000 300.000 Sta. $100,000 100.000 200.000 100.000 SSCOLAR Required Give the journal entries recorded by Peerless Product Corporation for 20x1 for consolidation of Special Foods and prepare consolidation sheets. 3. Consolidated Balance Sheet with Majority-Owned Subsidiary Assume that on January 1, 20X1, Peerless Products Corporation acquires 80 percent of the common stock of Special Foods Inc. for $310,000. At that date, the fair value of the noncontrolling interest is estimated to be $77,500. The balance sheets of Peerless and Special Foods immediately after acquisition are shown as below: Peerless Products Special Foods Special Foods' Fair Fair Value Value Increment $ 40,000 75.000 100.000 175.000 550.000 50.000 60.000 10.000 $65.000 50,000 360,000 $5.000 10.000 60,000 300.000 500.000 10.00 300.000 Assets Cash Accounts Receivable Inventory Land Bulldings & Equipment Accumulated Depreciation Net took Value Investment in Special Foods Stock Total Assets Liabilities & Stockholders' Equity Accounts Payable Bonds Payable Common Stock Retained Earnings Total Liabilities & Equity 400,000 310.000 51.100.000 S475.000 S25.000 $ 100,000 200.000 500.000 300.000 Sta. $100,000 100.000 200.000 100.000 SSCOLAR Required Give the journal entries recorded by Peerless Product Corporation for 20x1 for consolidation of Special Foods and prepare consolidation sheets