Problem Solving - Journal: Using the data in the attached spreadsheet, perform the accounting required for the acquisition of Little, Inc. by Big, Inc. Within the worksheet, you are to: 1. Select an accounting method (either cost or equity) and explain why you selected this method 2. Perform the required journal entries 3. Complete the consolidation worksheet 4. Prepare the consolidated balance sheet, income statement, and statement of equity in good form Complete all work on the spreadsheet attached to this assignment. Clearly identify the requirements being addressed. Show all calculations within the cells of an Excel spreadsheet. This means that you must use formulas and links so that the thought process can be examined. Make good use of comments to convey your thought process as well. No hard coding of solutions. Make sure to label your answers and provide support where needed. Your responses should be complete, well written, and in conformity with APA Requirements.

Part II Assume that Big Company decides to acquire 100% of Little Company stock for $200,000. Prepare the consolidated balance sheet and any supporting worksheets. Big Company Balance Sheet Assets, Liabilities & Equities Book Value Cash AR Inventory Land PP&E Accumulated Depreciation Patent Total Assets AP Common Stock Additional Paid In Capital Retained Earnings Total Liabilities & Equity $500,000 $10,000 $50,000 $40,000 $400,000 -$150,000 $0 $850,000 $110,000 $395,000 $300,000 $45,000 $850,000 Little Company Balance Sheet Assets, Liabilities & Equities Book Value Cash $35,000 AR $10,000 Inventory $65,000 Land $40,000 PP&E $40,000 Accumulated Depreciation -$5,000 Patent $0 Total Assets $185,000 AP $25,000 Common Stock $25,000 Additional Paid In Capital $35,000 Retained Earnings $100,000 Total Liabilities & Equity $185,000 Assume that Fair Value of all noncash assets are 25% greater than book value