Andrea Co. acquired 70% of Calabrese Co. on January 1, 2016. At the date of acquisition, the excess acquisition price was allocated partly to undervalued building of $108,000 (6-year remaining life) and undervalued capitalized software of $860,000 (20-year remaining life). The remaining excess was allocated to goodwill of $130,000. Various Intra-Entity Transactions Were Recorded by the Related Companies: On February 13, 2018, Andrea Co. sold land to Calabrese Co. for $1,200,000 cash. The land had been acquired by Andrea Co. in 1987 for $380,000. On March 1, 2020, Calabrese Co. sold the land to unaffiliated buyers for $1,320,000. On January 1, 2019, Andrea sold equipment to Calabrese Co. for $140,000. The equipment had been acquired by Andrea in 2015 at a cost of $120,000 and had a remaining book value of $100,000 at the date of transfer. The equipment had a remaining useful life of 10 years. In 2018 through 2020, Andrea transferred finished goods to Calabrese Co. Note: Round all gross profit rates to the nearest 100th. Period Cost 2018 2019 2020 $ 50,000 $ 60,000 $ 90,000 Transfer Price $ 70,000 $ 100,000 $ 120,000 Unsold Goods at Year-end*. $ 12,000 $ 30,000 $ 50,000 *The ending inventories are at transfer price. Questions 16 through 20 involves Worksheet Entries for 2020: 16. Consolidation Worksheet Entry A would require a: A. Debit Capitalized Software, $651,000. B. Credit Non-controlling Interest, $237,900. C. Credit Investment in Calabrese Co., $597,800. D. Debit Building, $18,000. 17. In 2020, if Calabrese Co. earned income of $220,000, and declared and paid dividends of $60,000, Consolidation Worksheet Entry I would require a: A. Debit Investment in Calabrese Co., $112,000. B. Debit Equity in Sub Earnings, $111,300. C. Credit to Equity in Sub Earnings, $154,000. D. Credit to Investment in Calabrese Co., $112,000. Question 18 requires use of Exhibit 3 below for 2020: Exhibit 3: Worksheet for Balance Sheet (partial) (2020) Balance Sheet (selected) Parent Subsidiary Debit Credit NCI Consolidated Buildings (net) Capitalized Software (net) 780,000 318,000 490,000 260,000 18. Using data in Exhibit 3 above, given the inter-entity transactions, what would be the consolidated balances for Buildings and Capitalized Software, respectively, at the balance sheet date? A. $1,270,000; $1,223,000. B. $1,270,000; $1,180,000. C. $1,316,000; 1,440,000. D. $1,288,000; $1,223,000. 19. The unsold finished goods at 12/31/19 were sold in 2020. Consolidation Worksheet Entry *G at December 31, 2020 would require a: A. Credit to Cost of Goods Sold, $8,400. B. Debit to Retained Earnings (Seller), $12,000. C. Credit to Investment in Calabrese Co., $12,000. D. Debit to Cost of Goods Sold, $30,000. 20. During 2020, assume that Andrea sold the finished goods to Calabrese on account. The journal entry to record the transfer would require a: A. Credit Cost of Goods Sold, $120,000, on the seller's books. B. Debit Inventory, $90,000, on the buyer's books. C. Credit Cash, $120,000, on the buyer's books. D. Debit Due from Subsidiary, $120,000, on the seller's books. 21. Consolidation Worksheet Entry TI at the end of 2020 would require a: A. Debit to Land-P, $920,000. B. Credit to Gain on Sale, $540,000. C. Credit to Cost of Goods Sold, $120,000. D. Debit to Sales, $90,000. 22. Consolidation Worksheet Entry G at the end of 2020 would require a: A. Credit to Sales, $120,000. B. Credit to Inventory, $12,000. C. Debit to Cost of Goods Sold, $12,500. D. Debit to Inventory, $12,500. Question 23 requires use of Exhibit 4 below for 2020: Exhibit 4: Worksheet for Income Statement (partial) (2020) Income Statement (selected) Parent Subsidiary Debit Credit NCI Consolidated Cost of Goods Sold 480.000 366.000 23. Using data in Exhibit 4 above, given the inter-entity transactions, what would be the consolidated balance of Cost of Goods Sold at the end of 2020? A. $726,500. B. $738,500. C. $846,500. D. $858,500. 24. In 2020, Consolidation Worksheet Entry *TA would require a: A. Credit to Equipment, $16,000. B. Debit to Gain on Sale, $40,000. C. Credit to Accumulated Depreciation, $60,000. D. Debit to Equipment, $20,000. Question 25 requires use of Exhibit 5 below for 2020: Exhibit 5: Worksheet for Income Statement (partial) (2020) Income Statement (selected) Parent Subsidiary Debit Credit NCI Consolidated Depreciation Expense 48.0001 32,000 25. Using data in Exhibit 5 above, given the inter-entity transactions, what would be the consolidated balance of Depreciation Expense at the end of 2020? A. $80,000. B. $72,000. C. $84,000. D. $76,000. Questions 26 through 28 requires use of Exhibit 6 below for 2020: Exhibit 6: Worksheet for Balance Sheet (partial) (2020) Balance Sheet (selected) Parent Subsidiary Debit Credit NCI Consolidated Equipment Accumulated Depreciation 400,000 (180,000 360.000 (110,000) 26. Using data in Exhibit 6 above, given the inter-entity transactions, what would be the consolidated balance of Equipment at the end of 2020? A. $756,000. B. $740,000. C. $780,000. D. $778,000. 27. Using data in Exhibit 6 above, given the inter-entity transactions, what would be the consolidated balance of Accumulated Depreciation at the end of 2020? A. $294,000. B. $286,000. C. $242,000. D. $238,000. 28. Using data in Exhibit 6 above, given the inter-entity transactions, what would be the consolidated book value of the equipment at the end of 2020? A. $542,000. B. $548,000. C. $560,000. D. $540,000. Question 29 requires use of Exhibit 7 below for 2020: Exhibit 7: Worksheet for Balance Sheet (partial) (2020) Balance Sheet (selected) Parent Subsidiary Debit Credit NCI Consolidated Land 1,460,000 886,000 Remember: The subsidiary sold the land in 2020 to unrelated buyers. 29. Using data in Exhibit 7 above, given the inter-entity transactions, what would be the consolidated balance of Land at the end of 2020? A. $3,666,000. B. $2,346,000. C. $2,342,000. D. $1,980,000 30. Assuming the land is the only property disposition in the consolidated group for 2020, how much gain should be reported on the consolidated balance sheet at the end of the year? A. $0. B. $120,000 C. $820,000. D. $940,000