Using the data in the Option 1 Spreadsheet (linked at the bottom of the page), perform the accounting required for the acquisition of Little, Inc. by Big, Inc. This is an 80% acquisition, where the book value of the assets acquired equals the acquisition price. Within the worksheet, you are to:

Perform the required journal entries

Complete the consolidation worksheet

Prepare the consolidated balance sheet in good form

HOW IS THIS DIFFERENT FROM 100%

Assume that Big Company decides to acquire 80% Little Company for $500,000. Prepare the appropriate journal entries.

Big Company Balance Sheet
Assets, Liabilities & Equities	Book Value
Cash	$2,100,000
AR	$10,000
Inventory	$200,000
Land	$40,000
PP&E	$400,000
Accumulated Depreciation	-$150,000
Patent	$0
Total Assets	$2,600,000
AP	$100,000
Common Stock ($10 par)	$450,000
Additional Paid In Capital	$600,000
Retained Earnings	$1,450,000
Total Liabilities & Equity	$2,600,000
Little Company Balance Sheet
Assets, Liabilities & Equities	Book Value
Cash	$35,000
AR	$10,000
Inventory	$65,000
Land	$40,000
PP&E	$400,000
Accumulated Depreciation	-$150,000
Patent	$0
Total Assets	$400,000
AP	$100,000
Common Stock	$100,000
Additional Paid In Capital	$50,000
Retained Earnings	$150,000
Total Liabilities & Equity	$400,000

*Prepare the journal entries for a 80% asset acquisition (using big company cash)

*Prepare the journal entries for a 80% acquision using 10,000 shares of big company stock

*Prepare Elimination Entries for Stock Acquisition
*Prepared consolidated worksheet