5 Pant House Corporation has been operating profitably since its creation in 1960. At the beginning of 2019, House acquired a 70 percent ownership in Wilson Company. At the acquisition date, House prepared the following fair-value allocation schedule: Consideration transferred for 70% interest Wilson Fair value of the 30s noncontrolling interest Wilson business fair value Wilson book value Excess fair value over book value. Assignments to adjust Wilson's assets to fair values To buildings (20-year remaining life) To equipment (4-year remaining life) ences To franchises (10-year remaining life) 742,000 318,000 $1,040,000 $13,000 247,000 697,000 (23,800) 73,000 146,200 100,800 To goodwill (indefinite life) House regularly buys inventory from Wilson at a markup of 25 percent more than cost. House's purchases during 2019 and 2020 and related ending inventory balances follow: Intra-Entity Remaining Intra-Entity Inventory- End of Year (at transfer price) Year 2019 2020 Purchases $135,000 162,500 $45,000 65,000 On January 1, 2021, House and Wilson acted together as co-acquirers of 80 percent of Cuddy Company's outstanding common stock. The total price of these shares was $274,400, indicating neither goodwill nor other specific fair-value allocations. Each company put up one-half of the consideration transferred. During 2021, House acquired additional inventory from Wilson at a price of $209,000. Of this merchandise, 45 percent is still held at year-end. Following are the financial records for the three companies for 2021. Sales and other revenues Cost of goods sold Operating expenses House Corporation $ (1,040,384) 605,000 307,000 FEA DOE Wilson Company $ (802,780) $ Cuddy Company (315,300) 308,000 273,500 144,000 99,500 Next