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On January 5, 20X1, Alpha Inc. acquired 80% of the outstanding voting shares of Beta Inc. for $2,000,000 cash. Following are the separate balance sheets for the two companies immediately after the stock purchase, as well as fair value information regarding Beta Inc.: Beta Alpha Book Value Fair Value Assets Current assets $ 1,750,000 $ 500,000 $ 500,000 Fixed assets, net 5,000,000 1,625,000 2,000,000 Investment in Beta 2,000,000 - - Total Assets $ 8,750,000 $ 2,125,000 $ 2,500,000 Liabilities Current liabilities $ 250,000 $ 125,000 $ 125,000 Stockholders' Equity Common stock 7,000,000 1,500,000 Capital in excess of par 500,000 - Retained earnings 1,000,000 500,000 Total Stockholders' Equity 8,500,000 2,000,000 Total Liabilities and Stockholders’ Equity $ 8,750,000 $ 2,125,000 Required: Prepare the entries for adjustments and eliminations required to prepare the consolidated balance sheet immediately after acquisition under the acquisition method. Prepare the consolidated balance sheet immediately after acquisition.
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