On January 2, 2011, Phillips Company purchased 80% of Sanchez Company and 90% of Thomas Company for $225,000 and $168,000, respectively. Immediately before the acquisitions, the balance sheets of the three companies were as follows:

The note receivable and interest receivable of Sanchez relate to a loan made to
Thomas Company on October 1, 2010. Thomas failed to record the accrued interest expense on the note.

Required:
Prepare a consolidated balance sheet workpaper as of January 2, 2011. Any difference between book value and the value implied by the purchase price relates to subsidiaryland.

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Phillips Sanchez 20,000 20,000 Cash Accounts receivable Note receivable Interest receivable Inventory Equipment Land 43,700 24,000 10,000 300 96,000 40,000 80,000 $294,000 $400,000 28,000 120,000 60,000 180,000 $788,000 一0一 43,000 30,000 70,000 $188,000 Total Accounts payable Note payable Common stock Other contributed capital Retained earnings 18,000 10,000 75,000 40,000 40,000 $183,000 28,000 20,000 300,000 300,000 160,000 $788,000 120,000 90,000 64,000 $294,000 Total