P has acquired 90% of the outstanding stock of S by paying $100 per share for 9,000 of the 10,000, $10 par common shares outstanding. The condensed balance sheet for S is shown below along with the market values for the assets and liabilities:
Cost Market Value
Inventory (FIFO) 50,000 60,000
Other Current Assets 90,000 90,000
Land 75,000 90,000
Building (net) 500,000 550,000 (Straight line 20 years)
Equipment (net) 150,000 180,000 (Straight Line 6 years
Patent 15,000 50,000 (Straight Line 7 Years)
Current Liabilities 75,000 75,000
Long Term Debt 100,000 95,000 (Straight Line 5 Years)
Common Stock 100,000
Paid in Capital 200,000
Retained Earnings 305,000
Prepare the C/E entry for the date of acquisition.