5. Use the information is Exercise 3. Assume that Pattern paid $400,000 for an 80% interest in Stock Company. Any difference between value implied by the purchase price and book value is attributed to land.

A. Prepare the entry to eliminate Ps investment in S

B. Allocate the difference between implied and book value

C. Complete the worksheet below

Pattern Company and Stock Company Workpaper January 2, 2013
	Pattern Company	Stock Company	Eliminations		Noncon. Interest	Cons. Bal. Sheet
			Debit	Credit
Assets
Cash	$ 200,000	$ 50,000
Accounts Receivable	75,000	25,000
Inventory	80,000	50,000
Investment in S	400,000
Difference between Implied and Book Value
Plant & Equip. (Net)	500,000	350,000
Land	100,000	50,000
Total Assets	$1,355,000	$525,000
Liabilities & Equity
Accounts Payable	$ 100,000	$ 75,000
Capital Stock
P Company	1,000,000
S Company		300,000
Retained Earnings
P Company	255,000
S Company		150,000
Noncontrolling Interest	________	_______
Total Lia. & Equity	$1,355,000	$525,000

D. Prepare a consolidated balance sheet on the date of acquisition for Pattern Company and Stock Company.