Exercise 6 (LO 6, 7, 9) Bargain purchase, allocation. Lancaster Company is purchasing 100% of the outstanding common stock of Villard Company for $600,000 plus $20,000 of direct acquisition costs. The following balance sheet was prepared for Villard on the date of the purchase:

Based on the preceding facts, 1. Prepare a zone analysis and a determination and distribution of excess schedule.
2. Prepare the elimination entries that would be made on a consolidated worksheet prepared on the date of purchase.