On January 1, 2013, Pinnacle Corporation exchanged $3,200,000 cash for 100 percent of the outstanding voting stock of Strata Corporation. Pinnacle plans to maintain Strata as a wholly owned subsidiary with separate legal status and accounting information systems.
At the acquisition date, Pinnacle prepared the following fair-value allocation schedule
Fair value of Strata (consideration transferred) . . . . . . . . . . . . . . . . . . . $3,200,000
Carrying amount acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,600,000
Excess fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 600,000
to buildings (undervalued) . . . . . . . . . . . . . . . . . . . . . . $ 300,000
to licensing agreements (overvalued) . . . . . . . . . . . . . . (100,000) . . . . . 200,000
to goodwill (indefinite life) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 400,000
Immediately after closing the transaction, Pinnacle and Strata prepared the following post acquisition balance sheets from their separate financial records.

Prepare a January 1, 2013, consolidated balance sheet for Pinnacle Corporation and its subsidiary Strata Corporation.

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Pinnacle Strata Cash Accounts receivable Inventory Investment in Strata Buildings (net) Licensing agreements Goodwill 433,000 122,000 1,2101) 1,235,10 3,200,000 5,572,000 283,000 350,000 ,845,000 0 3,000,000 350,000 Total assets. Accounts payable. Long-term debt Common stock Additional paid-in capital Retained earnings (375,000) (2,700,000) 2,625,000) 3,000,000) (1,000,000) (500,000) (6,000,000) 1,100,000) (300,000) Total liabilities and equities. (12,000,000) (5,600,000)