Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2018, for $802,720 cash. At the acquisition date, Sierra's total fair value, including the non-controlling interest, was assessed at $1,003,400 although Sierra's book value was only $690,000. Also, several individual items on Sierra's financial records had fair values that differed from their book values as follows:

_______________________________________ Book Value __________ Fair Value

Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 65,000 . . . . . . . . . . $ 290,000

Buildings and equipment

(10-year remaining life). . . . . . . . . . . . . . . . . . . . . . .287,000 . . . . . . . . . . . . 263,000

Copyright (20-year remaining life). . . . . . . . . . . . . . 122,000 . . . . . . . . . . . . 216,000

Notes payable (due in 8 years). . . . . . . . . . . . . . . . . (176,000) . . . . . . . . . . (157,600)

For internal reporting purposes, Padre, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies.

At year-end, there were no intra-entity receivables or payables. Prepare a worksheet to consolidate the financial statements of these two companies.

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Padre Slerra Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra S(1.394.980) S (684,900) 432,000 11.600 6,100 9.200 774,000 274,000 0 52.100 177.120) Net income $ (472 $ (226 Padre Slerra Net income Dividends declared (472,000) (226,000) 65,000 260,000 $1.437000 (691000 Current assets ..$ 856,160 764,700 927,840 360,000 909,000 65,000 275,400 115,900 Buildings and equipment (net) Copyright. Notes payable . (541,000) 176,000) (300,000) (100,000) (450,000) (60,000) Additional paid-in capital Retained earnings (above) 91 3,053