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    Consolidation entries for an acquisition

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    A parent acquired 100% of a subsidiary by exchanging stock valued at $2,000,000. The equity of the sub was $1,500,000 and the fair market value of the fixed assets exceeded the book value by 200,000.
    1. What would be the consolidation entry under a purchase?
    2. What do you think would be the consolidation entry if the parent only acquired 80% of the subsidiary?

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    Solution Preview

    1. Proceed: $2000k
    <br> Equity: $1500k
    <br> Purchase Price Diff: $500k allocated ...

    Solution Summary

    The expert examines consolidation entries for an acquisition.