A. Investment in Craig Co.

950,000
Cash 950,000
To record the acquisition of Craig Company's oustanding shares

A. Land 50,000
Building 100,000
Goodwill 50,000
Bonds Payable 20,000
Deferred Tax Liability 10,000
Retained Earnings - C. Co. 420,000
Additional Paid-In Capital 650,000
To adjust the assets and liabilities of Craig Company

A. Common Stock 300,000

Additional Paid-In Capital 650,000
Investment in Craig Co. 950,000
To eliminate the subsidiary account against the equity accounts
 Knight (100%)
Consideration Transferred 950,000
Less: Book Value of Interest Acquired
Common Stock (P10 par) 300,000
Retained Earnings 420,000
Total Equity Interest 720,000
Excess 230,000
Less: Adjustments of Identifiable Net Assets
Increase in Land 50,000
Increase in Building 100,000
Decrease in Bonds Payable 20,000
Decrease in Deferred Tax 10,000 180,000
Goodwill 50,000