Consolidated Worksheet at End of the Second Year of Ownership $($Equity Method$)$ Consolidated Worksheet at End of the Second Year of Ownership $($Equity Method$)$

On January $1,2020,$ Peter Corporation acquired $75$ percent of Student Company's net identifiable assets, at underlying

book value. The fair value of the noncontrolling interest was equal to $25$ percent of the book value of Sub at that date.

Peter uses the equity method in accounting for its ownership of Sub. On December $31,2022,$ the trial balances of the two

companies are as follows:

Required:

On January $1,2020,$ Peter Corporation acquired $75$ percent of Student Company's net identifiable assets, at underlying book value. The fair value of the noncontrolling interest was equal to $25$ percent of the book value of Sub at that date. Peter uses the equity method in accounting for its ownership of Sub. On December $31,2022,$ the trial balances of the two companies are as follows:

$\backslash$table$[[$Item$,$Parent Corporation,Sub Company$],[$Debit$,$Credit,Debit,Credit$],[$Current Assets,$$413,333,,$$$327,500,],[$Depreciable Assets,$2,000,000,,750,000,],[$Investment in Sub,$538,125,,,],[$Cost of Goods Sold,$1,750,000,,800000,],[$Depreciation Expense,$133,333,,62,500,],[$Other Expenses,$750,000,,100,000,],[$Dividends Declared,$10,000,,10,000,],[$Accumulated Depreciation,,$$666,667,,$$$250,000],[$Current Liabilities,,$75,000,,20,000],[$Long$-$Term Debt,,$250,000,,90,000],[$Common Stock,,$200,000,,90,000],[$Retained Earnings,,$1,000,000,,100,000],[$Sales$,,3,000,000,,1,500,000],[$Income from Standard Co$.,,403,125,,],[$Total$,$$$5,594,791,$$$5,594,792,$$$2,050,000,$$$2,050,000]]$Requirement $1$: Give all equity method entries required on December $31,2022,$ to prepare consolidated financial statements.