Below are the details regarding Par Wholesale Corporation and Sub Corporation:

Par Wholesale Company acquired 90% of Sub Corporation's common stock on December 31, 2005, for $1,152,000. At that date, the fair value of the noncontrolling interest was $128,000, and Sub reported common stock outstanding of $500,000, Additional paid-in capital - Common stock was $280,000, and Retained Earnings was $420,000. The book values and fair values of Sub's Assets and liabilities were equal, except for land, which was worth $30,000 more than its book value.

On April 1, 2006, Par Wholesale issued at par $200,000, 10% bonds directly to Sub; interest on the bonds is payable March 31 and September 30.

On January 2, 2007, Par Wholesale purchased all of Sub's outstanding 10-year 12% bonds from an unrelated investor at 98.

The bonds originally had been issued on January 2, 2001, for 101. Interest on the bonds is payable December 31 and June 30.

Since the date it was acquired by Par Wholesale, Sub has sold inventory to Par on a regular basis. The amount of such intercompany sales totaled $64,000 in 2006 and $78,000 in 2007, including a 30% Gross Profit. All inventory transferred in 2006 had been resold by Dec 31, 2006 except inventory for which Par Wholesale had paid $15,000 and did not resell until January 2007. All inventory transferred in 2007 had been resold at December 31, 2007, except merchandise for which Par Wholesale had paid $18,000.

At December 31, 2007, trial balances for Par Wholesale and Sub Corp are presented in the tab labeled "Worksheet".

As of December 31, 2007, Sub had declared but not yet paid its fourth-quarter dividend of $10,000. Both Par Wholesale and Sub Inc. use straight-line depreciation and amortization, including the amortization of bond discount and premium.

On December 31, 2007, Par Wholesale's management reviewed the amount attributed to Goodwill as a result of its purchase of Sub Corporation's Common Stock and concluded that an impairment loss in the amount of $25,000 had occurred during 2007 and should be shared proportionately between the controlling and noncontrolling interests. Par Wholesale Company uses the fully adjusted equity method to account for its investment in Sub Company.

REQUIRED:

a. Show your work to compute the amount of Goodwill as of January 1, 2007

b. Show your work in computing the balance of Par's Investment in Sub Stock account as of January 1, 2007

c. Show your work to Compute the gain or loss on the constructive retirement of Sub's bonds that should appear in the 2007 consolidated income statement

d. Show work to compute the income that should be assigned to the Noncontrolling Interest in the 2007 consolidated income statement.

e. Show your work to compute for the total noncontrolling interest as of December 31, 2006

f. Prepare all elimination entries that you will then use to prepare the consolidation worksheet as of December 31, 2007.

g. Complete the consolidation worksheet labeled "worksheet" as of December 31, 2007