Question: On December 31, 200X P Corporation paid $300,000 cash for 80% of the common stock of S Company which becomes a subsidiary. Following information is shown prior to the acquisition being recorded:
S market values are:
Plant $250,000
Inventory $50,000
1. Prepare the entries in journal format to record the acquisition and, post to the general ledger accounts.
2. Prepare a consolidation work paper.
3. Prepare consolidated balance sheet.