On January 1, 2019, Roxy Corp. issued shares of its common stock to acquire all of the outstanding common stock of Westwood Inc. Westwood's book value was only $140,000 at the time, but Roxy issued 12,000 shares having a par value of $1 per share and a fair value of $20 per share. Roxy was willing to convey these shares because it felt that buildings (ten-year life) were undervalued on Westwood's records by $60,000 while equipment (five-year life) was undervalued by $25,000. Any consideration transferred over fair value of identified net assets acquired is assigned to goodwill. Following are the individual financial records for these two companies for the year ended December 31, 2022. Roxy Westwood
Corp. Inc.
Revenues $ 372,000 $ 108,000
Expenses (264,000 ) (72,000 )
Equity in subsidiary earnings 25,000 0
Net income $ 133,000 $ 36,000
Retained earnings, January 1, 2022 $ 765,000 $ 102,000
Net income (above) 133,000 36,000
Dividends paid (84,000 ) (24,000 )
Retained earnings, December 31, 2022 $ 814,000 $ 114,000
Current assets $ 150,000 $ 22,000
Investment in Westwood Inc. 242,000 0
Buildings (net) 525,000 85,000
Equipment (net) 389,250 129,000
Total assets $ 1,306,250 $ 236,000
Liabilities $ 82,250 $ 50,000
Common stock 360,000 72,000
Additional paid-in capital 50,000 0
Retained earnings, December 31, 2022 (above) 814,000 114,000
Total liabilities and stockholders’ equity $ 1,306,250 $ 236,000
Required:
1. Prove investment bal in Westwood $242,000
2. Prepare a consolidation worksheet Entries (only entries S, A, I, D, E, or P if necessary; no need for whole worksheet) for this business combination.

Zachary company produces commercial gardening equipment. since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. the costs and cost drivers associated with the four overhead activity cost pools follow: activities unit level batch level product level facility level cost $ 64,800 $ 27,730 $ 15,000 $ 154,000 cost driver 2,400 labor hrs. 47 setups percentage of use 11,000 units production of 780 sets of cutting shears, one of the company’s 20 products, took 240 labor hours and 7 setups and consumed 15 percent of the product-sustaining activities. required: (a) had the company used labor hours as a company wide allocation base, how much overhead would it have allocated to the cutting shears? (b) how much overhead is allocated to the cutting shears using activity-based costing? (c) compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 780 units are produced. if direct product costs are $150 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? (d) assuming that activity-based costing provides a more accurate estimate of cost, indicate whether the cutting shears would be over- or underpriced if direct labor hours are used as an allocation base. explain how over-or undercosting can affect vaulker's profitability. (e) comment on the validity of using the allocated facility-level cost in the pricing decision. should other costs be considered in a cost- plus pricing decision? if so, which ones? what costs would you include if you were trying to decide whether to accept a special order?