On January 2, 2011, Prunce Company acquired 90% of the outstanding common stock of Sun Company for $192,000 cash. Just before the acquisition, the balance sheets of the two companies were as follows:

The fair values of Sun Company’s assets and liabilities are equal to their book values with the exception of land.

Required:
A. Prepare a journal entry to record the purchase of Sun Company’s common stock.
B. Prepare a consolidated balance sheet at the date ofacquisition.

Prunce Cash Accounts receivable (net) Inventory Plant and equipment (net) Land $260,000 142,000 117,000 386,000 63,000 $968,000 64,000 23,000 54,000 98,000 32,000 271,000 Total asset Accounts payable Mortgage payable Common stock, $2 par value Other contributed capital Retained earnings 104,000 72,000 400,000 208,000 184,000 $968,000 $ 47,000 39,000 70,000 20,000 95.000 Total equities $271,000