1. Matador Co. obtained all of the common stock of Tampa Co. on January 1, 2021. As of that date, Tampa had the following trial balance:

	Debit	Credit
Accounts payable		$ 60,000
Accounts receivable	$ 50,000
Additional paid-in capital		60,000
Buildings net (10-year life)	140,000
Cash and short-term investments	70,000
Common stock		300,000
Equipment net (8-year life)	240,000
Inventory	110,000
Land	90,000
Long-term liabilities (mature 12/31/25)		180,000
Retained earnings, 1/1/21		120,000
Supplies	20,000
Totals	$ 720,000	$ 720,000

During 2021, Tampa reported net income of $96,000 while paying dividends of $12,000. During 2022, Tampa reported net income of $132,000 while paying dividends of $36,000.

Assume that Matador Co. acquired the common stock of Tampa Co. for $588,000 in cash. As of January 1, 2021, Tampas land had a fair market value of $102,000, its buildings were valued at $188,000, and its equipment was appraised at $216,000. Any additional excess cost was attributable to a trademark with a ten-year life. Matador decided to use the equity method for this investment.

Required:

1. Prepare ALL consolidation worksheet entries for December 31, 2021.
2. Prepare ALL consolidation worksheet entries for December 31, 2022.

Answer:

Calculation:

A. Consolidated Worksheet Entries 2021:

B. Consolidated Worksheet Entries 2022: