$1.$ Elizabeth said to you $$if my memory serves me correctly, you need to add together the financial statements of any equity investments that TC controls or has significant influence over. My financial accounting instructor said consolidated financial statements are required for public companies but not private companies. I could be wrong though. Also, I have no idea how to account for the shares we did not acquire in Small Parts. Someone mentioned $$non$-$controlling interest$$ so I included it on the preliminary consolidated financial statement but that is as far as I got. This was not covered in the financial accounting courses I took.$$

$2.$ On January $1,2024,$ TC acquired in separate transactions an $85\%$ controlling interest in Small Parts Limited $($Small Parts$),$ a $32\%$ interest in Willow Design Company $($Willow Design$),$ and $2,000$ shares of Zed Corporation $($Zed$).$

With the exception of Zed, the companies are involved with product manufacturing or design for luxury trailers. These investments create the necessary synergies for TC$$s operations.

$3.$ TC financed the acquisition of the $85,000(85\%)$ voting common shares of Small Parts with a bank loan. The Small Parts$$ shares were trading for $$75$ in the few days prior to the acquisition and a few days after the acquisition; however, to gain control of Small Parts, TC also paid a premium of $$15$ per share. The total amount paid was $$7,650,000.$

$4.$ TC acquired the $2,000$ shares of Zed for $$44,000$ as a short$-$term, non$-$strategic investment with the expectation that the shares would be sold at some point in the future depending on market conditions.

$5.$ TC acquired the $32\%(32,000$ voting common shares$)$ interest in Willow Design for a cash payment of $$325,000.$

$6.$ On June $1,2024,$ TC acquired all of the net assets of Princess Trailers Ltd$.$ for a cash payment of $$280,000.$ Princess Trailers had been operating a retail RV sales business and the owner$/$operator retired. This transaction has not yet been recorded. The valuators determined the plant and equipment had a remaining useful life of $5$ years on this date. The details of the acquisition are as follows:

Total cash paid $$400,000$

Carrying value$/$NBV Fair value

Land $ $85,000$ $$165,000$

Inventory $100,00090,000$

Plant and equipment $120,000100,000$

$7.$ On December $31,2024,$ the shares of Small Parts, Willow Design and Zed were trading at $$97,$ $$11,$ and $$19$ per share, respectively.

$8.$ When TC acquired Small Parts, the plant and equipment had a remaining useful life of $10-$years and the note payable matured on December $31,2031.$

$9.$ On June $1,2024,$ TC loaned Willow Design $$300,000$ at an annual interest rate of $$8\%.$ The amount of the loan and interest remains unpaid on December $31,2024.$

$10.$ During $2024,$ Willow Design sold $$500,000$ of inventory to TC$.$ This inventory originally cost Willow Design, $$280,000.$ The majority of the inventory acquired from Willow Design was used by TC for the luxury trailers which were sold in $2024.$ The remaining inventory amounted to $20\%$ as at December $31,2024.$

$11.$ On December $1,2024,$ TC sold equipment to Small Parts for $$320,000.$ On the date of sale, the equipment had a net book value of $$280,000$ and a remaining useful life of $8$ years.

$12.$ A goodwill impairment test in $2024$ for the goodwill acquired in the Small Parts acquisition amounted to $$50,000.$

$13.$ TC$,$ Small Parts, and Willow Design pay income tax at the rate of $40\%.$