5 On January 1, 2017, Panther, Inc., issued securities with a total fair value of $564,000 for 100 percent of Stark Corporation's outstanding ownership shares. Stark has long supplied inventory to Panther. The companies expect to achieve synergies with production scheduling and product development with this combination. 10 points Although Stark's book value at the acquisition date was $312,000, the fair value of its trademarks was assessed to be $53,000 more than their carrying amounts. Additionally, Stark's patented technology was undervalued in its accounting records by $199,000. The trademarks were considered to have indefinite lives, and the estimated remaining life of the patented technology was eight years. In 2017, Stark sold Panther inventory costing $77,500 for $155,000. As of December 31, 2017, Panther had resold 66 percent of this inventory. In 2018, Panther bought from Stark $154,000 of inventory that had an original cost of $77,000. At the end of 2018, Panther held $41,700 (transfer price) of inventory acquired from Stark, all from its 2018 purchases. eBook Print During 2018, Panther sold Stark a parcel of land for $96,800 and recorded a gain of $17,400 on the sale. Stark still owes Panther $67,600 (current liability) related to the land sale References At the end of 2018, Panther and Stark prepared the following statements in preparation for consolidation. Stark Panther, Inc. Corporatiorn $(774,100) Revenues Cost of goods sold Other operating expenses Gain on sale of land Equity in Stark'a earnings s (368,000) 332,700 182,100 (17,400) (55,425 193,100 82,700 $(332,125) (371,000 s (92,200) (299,300 Net income Retained earnings 1/1/18 Net income Dividends declared (332,125) 90,700 (92,200) 29,500 $(612,425) S (362,000) Retained earnings 12/31/18 Cash and receivables Inventory Investment in Stark Trademarks Land, buildings, and equip. (net) Patented technology 117,000 356,600 718,000 169,000 120,500 63,400 306,100 136,700 731,900 1,923,500 $ 795,700 Total assets Liabilities Common stock Additional paid-in capital Retained earnings 12/31/18 (600,375) (400,000) (310,700) (612,425) $(1,923,500) (241,700) 130,000) (62,000) (362,000) Total liabilities and equity s (795,700) a. Show how Panther computed its $55,425 equity in Stark's earnings balance. b. Prepare a 2018 consolidated worksheet for Panther and Stark. Complete this question by entering your answers in the tabs below Required A Required B Show how Panther computed its $55,425 equity in Stark's earnings balance Equity in Stark's earnings