Harvard Company purchases a 90% interest in Bart Company for $720,000 on January 1, 2011. The investment is accounted for under the cost method. At the time of the purchase, a building owned by Bart is understated by $180,000; it has a 20-year remaining life on the purchase date. The remaining excess is attributed to goodwill. The stockholders’ equity of Bart Company on the purchase date is as follows:

Common stock ($10par). .... .. .. . . . .. . . . . .. $350,000

Retained earnings . . . . .. .. .. .... . . . .. . . .. . . 200,000

Total equity . . .. . .. .. .. .... .. . .. . . .. . . . . .. $550,000

The following summarized statements are for the year ended December 31, 2012. (Credit balance amounts are in parentheses.)

Required
Using the vertical format, prepare a consolidated worksheet for December 31, 2012. Precede the worksheet with a value analysis and a determination and distribution of excess schedule. Include income distribution schedules to allocate the consolidated net income to the noncontrolling and controlling interests.

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Harvard Bart Income Statements: Sales Cost of Goods Sold Operating Expenses Depreciation Expense Dividend Income. . 285,000 155,000 55,000 30,000 140,000 72,000 9,000) (92,000) Net Income. 40,000} - Retained Earnings Statements: (484,000) Retained Earnings, January 1, 2012-Harvard Retained Earnings, January 1, 2012-Bart Net Income Dividends Declared (320,000) 92,000 (40,000 10,000 20,000 (556,000 (350,000) Balance Sheets: Cash Inventory Land Building Accumulated Depreciation- Building. Equipment Accumulated Depreciation-Equipment Investment in Bart Company Current Liabilities Bonds Payable Common Stock-Harvard Paid-In Capital in Excess of Par-Harvard Common Stock-Bart.... Retained Earnings, December 31, 2012. 330,000 170,000 260,000 340,000 99,000 150,000 800,000 500,000 (380,000) (360,000) 340,000 250,000 190,000) 90,000) :....720,000 123,000) (60,000] 200,000) (800,000) (500,000) (350,000) 556,000) (350,000 Balance