Question: This alters problem However this problem is self contained because all

This alters problem. However, this problem is self-contained because all the facts are reproduced as follows: Company P acquired a 60% voting interest in Company S for $72 million cash at the start of the year. Immediately before the business combination, each company had the following condensed balance sheet accounts ($ in millions):

1. Prepare a tabulation of the consolidated balance sheet accounts immediately after acquisition. Use the balance sheet equation format.
2. Suppose P and S have the following results for the year:

Prepare income statements for the year for P, S, and the consolidated entity. Assume neither P nor S sold items to the other.
3. Using the balance sheet equation format, present the effects of the operations for the year on P’s accounts and on S’s accounts. Also tabulate consolidated balance sheet accounts at the end of the year. Assume that liabilities are unchanged.
4. Suppose S paid a cash dividend of $5 million. What accounts in requirement 3 would be affected and by howmuch?

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