Canan Corporation paid $16,200 for a 90% interest in Kodak Corporation on January 1, 2020, when Kodak's stockholders' equity consisted of $9,000 Capital Stock, APIC of $1,000 and $3,000 of Retained Earnings. The excess cost over book value was attributable to trademark, which has not been impaired since acquisition date.

Additional Information:

1. Canan sells merchandise to Kodak at 120% of Canan's cost. During 2020, Canan's sales to Kodak were $4,800, of which half of the merchandise (50%) remained in Kodak's inventory at December 31, 2020. (The 2020 ending inventory was sold in 2021.) During 2021, Canan's sales to Kodak were $6,000 of which 60% remained in Kodak's inventory at December 31, 2021.

At year-end 2021, Kodak owed Canan $5,000 for the inventory purchased during 2021.

2. Canan Corporation sold equipment with a book value of $2,000 and a remaining useful life of four years and no salvage value to Kodak Corporation on January 1, 2021 for $2,800. Straight-line depreciation is used.

3. During 2021, Kodak sold to Canan land for $50,000 that had a book value of $20,000. Canan still owns the land at 12/31/21.

4. Separate company financial statements for Canan Corporation and Kodak at December 31, 2021 are summarized in the first two columns of the consolidation working papers. See Spreadsheet Tab.

Required: Carefully follow and label each step

1. Prepare the acquisition analysis as of acquisition date. Compute the unamortized differential as of 1/1/2021.

2. Analyze each intercompany transaction. Label as either upstream downstream.

3. Separately calculate net income to the controlling interest for the year 2021.

4. Verify the calculation of the balance in the account equity in sub earnings and record the parent company entries with respect to its investment during 2021.

5. Prepare all elimination entries for 2021

6. Complete the consolidating spreadsheet for the year ended 2021.