# Complete problem 2-7 using the week 02 excel template. using the data

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Complete Problem 2-7 using the Week 02 Excel Template.
Using the data given in Problem 2-6, assume that Aron Company purchases 80% of the common stock of Shield Company for \$320,000 cash.
The following comparative balance sheets are prepared for the two companies immediately after the purchase:

Aron
Shield
Cash
\$ 315,000
\$ 40,000
Accounts receivable
70,000
30,000
Inventory
130,000
120,000
Investment in Shield Company
320,000

Land
50,000
35,000
Buildings and equipment
350,000
230,000
Accumulated depreciation
(100,000)
(50,000)
40,000
10,000
Total assets
\$1,175,000
\$415,000
Current liabilities
\$ 192,000
\$ 65,000
Bonds payable

100,000
Common stock (\$10 par)—Aron
100,000

Common stock (\$5 par)—Shield

50,000
Paid-in capital in excess of par
250,000
70,000
Retained earnings
633,000
130,000
Total liabilities and equity
\$1,175,000
\$415,000
Required
1. Prepare the value analysis and the determination and distribution of excess schedule for the investment in Shield Company.
2. Complete a consolidated worksheet for Aron Company and its subsidiary Shield Company as of December 31, 2015.
Information from 2-6
On December 31, 2015, Aron Company purchases of the common stock of Shield Company for \$450,000 cash. On this date, any excess of cost over book value is attributed to accounts with fair values that differ from book values. These accounts of Shield Company have the following fair values:
Cash
\$ 40,000
Accounts receivable
30,000
Inventory
140,000
Land
45,000
Buildings and equipment
225,000
25,000
Current liabilities
65,000
Bonds payable
105,000
The following comparative balance sheets are prepared for the two companies immediately after the purchase:

Aron
Shield
Cash
\$ 185,000
\$ 40,000
Accounts receivable
70,000
30,000
Inventory
130,000
120,000
Investment in Shield Company
450,000

Land
50,000
35,000
Buildings and equipment
350,000
230,000
Accumulated depreciation
(100,000)
(50,000)
40,000
10,000
Total assets
\$1,175,000
\$415,000
Current liabilities
\$ 192,000
\$ 65,000
Bonds payable

100,000
Common stock (\$10 par)—Aron
100,000

Common stock (\$5 par)—Shield

50,000
Paid-in capital in excess of par
250,000
70,000
Retained earnings
633,000
130,000
Total liabilities and equity
\$1,175,000
\$415,000

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