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House Corporation has been operating profitably since its creation in 1960. At the beginning of 2016, House acquired a 70 percent ownership in Wilson Company. At the acquisition date, House prepared the following fair-value allocation schedule: Consideration transferred for 78% interest in Wilson Fair value of the 30% noncontrolling interest Wilson business fair value Wilson book value Excess fair value over book value Assignments to adjust Wilson's assets to fair value: To buildings (28-year remaining life) To equipment (4-year remaining life) To franchises (18-year remaining life) To goodwill (indefinite life) $ 889,000 381,800 $ 1,270,000 876,000 394,800 $ 152,000 (31,200) 54,000 174,800 219, 200 House regularly buys inventory from Wilson at a markup of 25 percent more than cost. House's purchases during 2016 and 2017 and related ending inventory balances follow: Intra-Entity Remaining Intra-Entity Inventory Year Purchases End of Year (at transfer price) 2016 $90,000 $30,000 2017 125,000 50,000 On January 1, 2018, 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 $252,800, indicating neither goodwill nor other specific fair-value allocations. Each company put up one-half of the consideration transferred. During 2018, House acquired additional inventory from Wilson at a price of $243,000. Of this merchandise, 45 percent is still held at year-end. $ $ $ Sales and other revenues Cost of goods sold Operating expenses Income of wilson Company Income of Cuddy Company House Corporation (974,944) 620,000 241,000 (158,536) (30,520 Wilson Company (841,980) 329,000 286,500 @ (30,520) Cuddy Company (322,400) 148, eee 98, 100 @ @ Help Save up one-half of the consideration transferred. During 2018, House acquired additional inventory from Wilson at a price of $243,000. O this merchandise, 45 percent is still held at year-end. Wilson Company $ (841,980) 329,000 286,500 Cuddy Company (322,400) 148,000 98,100 $ $ House Corporation $ (974,944) 620,000 241,000 (158, 536) (30,520) $ (303,000) $ (837,000 (383,000) 100,000 $ (1,040,000) 34,994 109,550 1,061,536 132,920 387,000 313,000 241,000 $ 2,580,000 $ (720,000) (820,000) (1,040,000) $ (2,580,000) Sales and other revenues Cost of goods sold Operating expenses Income of Wilson Company Income of Cuddy Company Net income Retained earnings, 1/1/18 Net income (above) Dividends declared Retained earnings, 12/31/18 Cash and receivables Inventory Investment in Wilson Company Investment in Cuddy Company Buildings Equipment Land Total assets Liabilities Common stock Retained earnings, 12/31/18 Total liabilities and equities (76,380) (166,000) (76,300) 60,000 (182,300) 81,750 188,950 $ $ $ 5 (30,520) (257,000) $ (682,000) (257,000) 96,888 $ (843,000) $ 206,080 570,000 8 132,920 369,000 143,000 302,000 $ 1,723,000 $ (570,000) (310,000) (843,000) $ (1,723, 000) $ 142,eee 90,000 20,600 443,300 (111, 000) (150,000) (182,300) (443,380) $ $ Note: Parentheses indicate a credit balance. Using the three companies' following financial records for 2018, prepare a consolidation worksheet. The partial equity method based on separate company incomes has been applied to each investment. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of 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.) Connolldation Worksheet December 31, 2018 Consolidation Entries Noncontrolling Consolidated Accounts Dabit Credit Interest Balance House Wilson Corporation Company (974,944) (841,980) 620,000 329,000 241,000 286,500 (158,536) (30,520) (30,520) (303,000) (257,000) Cuddy Company (322,400) 148,000 98,100 (76,300) 0 0 Sales and other revenue Cost of goods sold Operating expenses Income of Wison Company Income of Cuddy Company Net Income Consolidated net income Net income attributable to noncontrolling interest (Wilson) Net income attributable to noncontrolling interest (Cuddy) Net income attributable to House Corporation Retnined earnings, 1/1/18 House Corporation Wilson Company Cuddy Company Net Income Dividends declared House Corporation Wilson Company Cuddy Company Retained earnings, 12/31/18 Cash and receivables Inventory Investment in Wilson Company (837,000) (682,000) (166,000) (76,300) (303,000) (257,000) 100,000 96,000 (1,040,000) 34,994 409,550 1.061,536 (843,000) 206,080 570,000 60,000 (182,300) 81.750 108,950 (682,000) (166,000) (76,300) (303,000) (257,000) 100,000 96,000 0 (843,000) 206,080 570,000 60,000 (182,300) | 81,750 108,950 Wilson Company Cuddy Company Net income Dividends declared House Corporation Wilson Company Cuddy Company Retained earnings, 12/31/18 Cash and receivables Inventory Investment in Wilson Company Investment in Cuddy Company Buildings Equipment Land Goodwill Franchise contracts Total assets Liabilities Noncontrolling interest in Cuddy Noncontrolling interest in Wilson Noncontrolling interest in subsidiary companies Common stock Retained earnings (above) Total liabilities and equities (1,040,000) 34,994 409,550 1,061,536 132,920 387,000 313,000 241,000 132,920 369,000 143,000 302.000 142,000 90,000 20,600 2,580,000 (720,000) 1.723,000 (570,000) 443,300 (111,000) 0 (820,000) (310,000) (1.040,000) (843,000) (2,580,000) (1,723,000) (150,000) (182,300) (443,300) 0 louse Corporation has been operating profitably since its creation in 1960. At the beginning of 2016, House acquired a 70 ercent ownership in Wilson Company. At the acquisition date, House prepared the following fair-value allocation schedule: Consideration transferred for 70% interest in Wilson Fair value of the 38% noncontrolling interest Wilson business fair value Wilson book value Excess fair value over book value Assignments to adjust Wilson's assets to fair value: To buildings (28-year renaining life) To equipment (4-year remaining life) To franchises (18-year remaining life) To goodwill (indefinite life) $ 889,000 381,000 $1,270,000 876,000 $ 394,000 $ 152,000 (31,200) 54,000 174,800 219,200 $ es louse regularly buys inventory from Wilson at a markup of 25 percent more than cost. House's purchases during 2016 and 017 and related ending inventory balances follow. Year 2016 2017 Intra-Entity Purchases $90,000 125,000 Remaining Intra-Entity Inventory- End of Year (at transfer price) $30,000 50,000 In January 1, 2018, House and Wilson acted together as co-acquirers of 80 percent of Cuddy Company's outstanding ommon stock. The total price of these shares was $252,800, indicating neither goodwill nor other specific fair-value llocations. Each company put up one-half of the consideration transferred. During 2018, House acquired additional wentory from Wilson at a price of $243,000. Of this merchandise, 45 percent is still held at year-end. $ $ Sales and other revenues Cost of goods sold Operating expenses Income of Wilson Company Income of Cuddy Camnan House Corporation (974,944) 620,000 241,000 (158,536) (30.520) Wilson Company (841,980) 329,000 286,500 $ Cuddy Company (322,400) 148,eee 98,100 @ (30.520)