Paulos Company purchases a controlling interest in Sanjoy Company. Sanjoy had identifiable net assets with a book value of $500,000 and a fair value of $800,000. It was agreed that the total fair...

Paulos Company purchases a controlling interest in Sanjoy Company. Sanjoy had identifiable net assets with a book value of $500,000 and a fair value of $800,000. It was agreed that the total fair value of Sanjoy’s common stock was $1,200,000. Use value analysis schedules to determine what adjustments will be made to Sanjoy’s accounts and what new accounts and amounts will be recorded if:

a. Paulos purchases 100% of Sanjoy’s common stock for $1,200,000.

b. Paulos purchases 80% of Sanjoy’s common stock for $960,000.