$(20$ points$)$ On January $1,2025,$ Trout Company purchased an $80\%$ interest in the capital stock of

Sardine Company for $$3,400,000.$ At that time, Sardine Company had common stock of $$2,200,000$

and retained earnings of $$620,000.$ Trout Company uses the cost method to record its investment in

Sardine Company, Differences between the fair value and the book value of the identifiable assets of

Sardine Company were as follows:

Inventory

$$400,000200,000$

$200,00080,000$

The book values of all other assets and liabilities of Sardine Company were equal to their fair values on

Jary $1,2025.$ The

sold in $2025$

Sardine Company's net income and dividends declared in $2025$ were as follows:

Year $2025$ Net Income of $$400,000$; Dividends Declared of $$100,000$

Required:

Prepare a consolidated statements workpaper for the year ended December $31,2026$ using the partially

completed worksheet. $($See Next Page$)($USE GREEN ACCOUNTING PAPER$)$

${?}^{******}$ Make sure headings are used and workpaper is in proper form. Make sure your name is on

your workpaper.$***$