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The individual financial statements for Gibson Company and Keller Company for the year ending December 31, 2018, follow. Gibson acquired a 60 percent interest in Keller on January 1, 2017, in exchange for various considerations totaling $540,000. At the acquisition date, the fair value of the noncontrolling interest was $360,000 and Keller's book value was $710,000. Keller had developed internally a customer list that was not recorded on its books but had an acquisition-date fair value of $190,000. This intangible asset is being amortized over 20 years Gibson sold Keller land with a book value of $90,000 on January 2, 2017, for $180,000. Keller still holds this land at the end of the current year Keller regularly transfers inventory to Gibson. In 2017, it shipped inventory costing $144,000 to Gibson at a price of $240,000. During 2018, intra-entity shipments totaled $290,000, although the original cost to Keller was only $203,000. In each of these years, 20 percent of the merchandise was not resold to outside parties until the period following the transfer. Gibson owes Keller $50,000 at the end of 2018 Sales Cost of goods sold Operating expenses Equity in earnings of Keller Net income Retained earnings, 1/1/18 Net income (above) Dividends declared Retained earnings, 12/31/18 Cash Accounts receivable Inventory Investment in Keller Land Buildings and equipment (net) Total assets Liabilities Common stock Additional paid-in capital Retained earnings, 12/31/18 Gibson Company $ (890,000) 590,000 190,000 (78,000) $ (188,000) $(1,206,880) (188,000) 115,000 $(1,279,000) $ 178,000 374,000 480,000 849,000 200,000 505,000 $ 2,586,000 $ (627.000) (680,000) 0 (1,279,000) Keller Company $ (590,000) 390,000 70,000 @ $ (130,000) $ (665,000) (130,000) 70,000 $ (725,000) $ 100,000 500,000 410,000 480,000 390,000 $ 1,880,000 $ (655, 800) (410,000) (90,000) (725,000) RROBA Retained earnings, 12/31/18 Cash Accounts receivable Inventory Investment in Keller Land Buildings and equipment (net) Total assets Liabilities Common stock Additional paid-in capital Retained earnings, 12/31/18 Total liabilities and equities $(1,279,000) $ 178,000 374,000 480,000 849,000 200,000 505,000 $ 2,586,000 $ (627,000) (680,000) $ (725, 000) $ 100,000 500,000 410,000 @ 480,000 390,000 $ 1,880,000 (655,000) (410,000) (90,000) (725, 000) $(1,880,000) (1,279,000) $12,586,000) (Note: Parentheses indicate a credit balance.) a. Prepare a worksheet to consolidate the separate 2018 financial statements for Gibson and Keller. b. How would the consolidation entries in requirement (a) have differed if Gibson had sold a building with a $105,000 book value (cost of $230,000) to Keller for $190,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life at the date of transfer. Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B How would the consolidation entries in requirement (a) have differed if Gibson had sold a building with a $105,000 book value (cost of $230,000) to Keller for $190,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life at the date of transfer. Do not mound intermediate calculations. If no antevis ruired for a transaction/event. Red Prepare a worksheet to consolidate the separate 2018 financial statements for Gibson and Keller. (Do not round Intermediate calculations. For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet. Amounts in the Debit and Credit columns should be entered as positive. Negative amounts for the Noncontrolling Interest and Consolidated Totals columns should be entered with a minus sign.) Show less GIBSON AND KELLER Consolidation Worksheet For the Year Ending December 31, 2018 Consolidation Entries Keller Debit Credit Accounts Gibson Noncontrolling Interest $ (890,000) 590,000 190,000 (78,000) $ (188,000) 17.400 Consolldated Totals $ (1,190,000) 688,200 269,500 $ (590,000) 390,000 70,000 0 $ (130,000) 78,000 $ (48,920) + Sales Cost of goods sold Operating expenses Equity in earnings of Keller Separate company net income Consolidated net income To noncontrolling interest To Gibson Company Retained earnings, 1/1-Gibson Retained earnings, 1/1- Keller Net Income Dividends declared Retained earnings, 12/31 Cash Accounts receivable (232,300) 48,920 (183,380) $ $ (1.206,000) $ (1,098,780) (188,000) 115,000 (665,000) (130,000) 70.000 $ (725,000) 42.000 (183,380) 115,000 28,000 $ (1,167,160) (1.279.000) $ 178,000 374,000 $ 100,000 500,000 $ 50,000 278,000 824,000 olo $ 1,880,000 $ (655,000) (410,000) (90,000) (725,000) 50,000 410,000 90,000 (1,279,000) (1,167,160) $ (551,440) $ (2,586,000) (551,440) $ (3,630,600) (1.880.000) $ 867,900 $ 118,900 a. Prepare a worksheet to consolidate the separate 2018 financial statements for Gibson and Keller. b. How would the consolidation entries in requirement (a) have differed if Gibson had sold a building with a $105,000 book value (c of $230,000) to Keller for $190,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life the date of transfer. Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B How would the consolidation entries in requirement (a) have differed if Gibson had sold a building with a $105,000 book value (cost of $230,000) to Keller for $190,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life at the date of transfer. (Do not round Intermediate calculations. If no entry is required for a transaction/event, select "No joumal entry required in the first account field.) No Transaction Accounts Debit Credit 1 Retained earnings 81,000 Buildings 40,000 Accumulated depreciation 121,000 O 2 2 4,000 Accumulated depreciation Operating expenses 4,000 ProForm acquired 70 percent of ClipRite on June 30, 2017, for $1,400,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $450,000 was recognized and is being amortized at the rate of $16,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $600,000 at the acquisition date. The 2018 financial statements are as follows: ClipRite $ (820,000) 455,000 155,000 Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/18 Net income Dividends declared Retained earnings, 12/31/18 Cash and receivables Inventory Investment in ClipRite Fixed assets Accumulated depreciation Totals Liabilities Common stock Retained earnings, 12/31/18 Totals ProForm $ (910,000) 590,000 210,000 (63,000) $ (173,000) $(2,800,000) (173,000) 210,000 $(1,963,000) 510,000 400,000 1,400,000 1,000,000 (200,000) $ 3, 110,000 $ (647,000) (500,000) (1,963,000) $(3,110,000) $ (210,000) $ (960,000) (210,000) 90,000 $(1,080,000) 410,000 810,000 1,150,000 (300,000) $ 2,070,000 $ (490,000) (500,000) (1,080,000) $(2,070,000) ProForm sold ClipRite inventory costing $80,000 during the last six months of 2017 for $200,000. At year-end, 30 percent remained. ProForm sells ClipRite inventory costing $255,000 during 2018 for $360,000. At year-end, 10 percent is left. Determine the consolidated balances for the following accounts: Sales Cost of goods sold Consolidated Balance $ 1,370,000 $ 659,500 Retained earnings, Totals $(3,110,000) $12,070,000) ProForm sold ClipRite inventory costing $80,000 during the last six months of 2017 for $200,000. At year-end, 30 percent remained ProForm sells ClipRite inventory costing $255,000 during 2018 for $360,000. At year-end, 10 percent is left. Determine the consolidated balances for the following accounts: Answer is complete but not entirely correct. Consolidated Balance Sales $ 1,370,000 Cost of goods sold $ 659,500 Operating expenses $ 381,000 Dividend income $ 0 Net income attributable to noncontrolling interest $ 58,200 Inventory S 1,199,500 Noncontrolling interest in subsidiary, 12/31/18 $ 698,900