Based on Chapter 5, so NCI and a Differential is involved.Key pages are 184 through 191. Part 1 must use same general format style as Figure 5-2 in text, and Part 2 must use same general format as Figure 5-4 in text. Remember additional formatting requirements in syllabus.

Part 1

On January 1, 20X2, Portland Corp. bought 80% of the stock of Spokane Corp. for $700,000. The Balance Sheets of the two companies immediately after acquisition (January 1, 20X2) of Spokane Corp. showed the following:

Portland Spokane

Cash $ 130,000 $ 100,000

Accounts Receivable 120,000 130,000

Inventory 400,000 10,000

Land 500,000100,000

Buildings & Equipment Net 1,000,000320,000

Copyrights 0 40,000

Investment in Spokane 700,000 0

Total Assets 2,850,000 700,000

Accounts Payable $ 320,000 60,000

Bonds Payable 1,180,000 40,000

Common Stock 1,000,000 400,000

Additional Paid in Capital 0 50,000

Retained Earnings 350,000150,000

Total Liabilities and Stockholders' Equity $2,850,000 700,000

On the date of acquisition, the Book Value of Spokane equaled its Fair Market Value (FMV), except for land that had a FMV of $140,000 and the copyrights with a FMV of $60,000. On the date of acquisition, the FMV of previously unrecorded identifiable intangibles (2-year life) of Spokane was $40,000, and the NonControlling Interest (NCI)s fair value is $175,000. Portland uses the equity method to record its investment in Spokane.

Required:

A. List all journal entries Portland makes to record its investment in Spokane on the date of acquisition.

B. List all Consolidation/Elimination Entries needed in order toprepare a workpaper for the consolidated Balance Sheet of Portland and Spokane immediately after the combination (January 1, 2022).

C. Prepare a workpaper for the consolidated Balance Sheet of Portland and Spokane immediately after the combination (January 1, 2022). Show all necessary elimination entries in their proper columns