Holmes acquires 100% of Watson in a transaction structured as an acquisition at January 1, 2010 for a payment as follows; payment to watson shareholders of 6 million cash, notes payable of four million due in 3 years at a market interest rate, and 100,000 shares of holmes common stock with a $5 par an A $20 fair value.
Problem A. under the acquisition method, how much is debited to homes investment account at January 1, 2010
Problem B. Under the purchase method, how much is debited to homes investment account at January 1, 2010
Problem c. Under both methods how much is the consolidated investment in Watson.