$1.$ On $1$ January $20$x$2,$ Fire Co $($P$)$ purchased $70\%$ of Wall Co $($S$)$s ordinary shares.

$2.$ At the date of acquisition, share capital of S was $$160,000$ and retained earnings were $$40,000.$

$3.$ The excess of the fair value of S over the underlying book value as at acquisition date was assigned to:

$$ Buildings that had a fair value of $$40,000$ greater than book value and remaining useful life of $10$ years from $1$ January $20$x$2$; and

$$ Goodwill. Goodwill impairment amounting to $20\%$ of its original cost was recognized in $20$x$2.$

$4.$ Fair value of S as at acquisition date was $$280,000.$ Non$-$controlling interests as at $1$ January $20$x$2$ had a proportionate share in the fair value of S at that date.

$5.$ During $20$x$2,$ the following transactions arose:

$$ S purchased inventory for $$64,000$ and sold it to P for $$96,000.$ P resold $$54,000$ of

the inventory during $20$x$3,$ while the balance of $$42,000$ remained unsold as at $31$

December $20$x$3.$

$$ P sold the building that it originally purchased for $$40,000$ to S for $$64,000.$

Accumulated depreciation at the date of sale was $$8,000.$ Estimated useful life at date of original purchase was $10$ years and at the date of resale was $8$ years. S had recognized a full year$$s depreciation on the building in $20$x$2.$

$6.$ During $20$x$3,$ P sold inventory purchased for $$120,000$ to S for $$180,000.$ S resold $40\%$ of the inventory during $20$x$3.$

$7.$ The financial statements of P and S for the year ended $31$ December $20$x$3$ are shown in the Consolidation Worksheet on Page $2.$

$8.$ Assume tax rate was $20\%.$

Required $($Ignore all tax effects$)$:

$1.$ Prepare the consolidation adjusting entries for the year ended $31$ December $20$x$3.$

$2.$ Complete the consolidation worksheet for the year ended $31$ December $20$x$3.$