Giant acquired all of Small's common stock on January 1, 2014, in exchange for cash of $770,000. On that day, Small reported common stock of $170,000 and retained earnings of $400,000. At the acquisition date, $65,200 of the fair-value price was attributed to undervalued land while $61,000 was assigned to undervalued equipment having a 10-year remaining life. The $73,800 unallocated portion of the acquisition-date excess fair value over book value was viewed as goodwill. Over the next few years, Giant applied the equity method to the recording of this investment.

Following are individual financial statements for the year ending December 31, 2018. On that date, Small owes Giant $12,200. Small declared and paid dividends in the same period. Credits are indicated by parentheses.

GiantSmallRevenues$(1,366,600)$(439,500)Cost of goods sold615,00092,500Depreciation expense212,500200,000Equity in income of Small(140,900)0Net income$(680,000)$(147,000)Retained earnings, 1/1/18$(1,620,000)$(685,000)Net income (above)(680,000)(147,000)Dividends declared320,000100,000Retained earnings, 12/31/18$(1,980,000)$(732,000)Current assets$478,500$285,000Investment in Small1,071,5000Land506,000215,000Buildings (net)360,000518,000Equipment (net)711,000319,000Goodwill00Total assets$3,127,000$1,337,000Liabilities$(897,000)$(435,000)Common stock(250,000)(170,000)Retained earnings(above)(1,980,000)(732,000)Total liabilities and equities$(3,127,000)$(1,337,000)

1. How was the $140,900 Equity in Income of Small balance computed?
2. Determine the totals to be reported by this business combination for the year ending December 31, 2018.
3. Prepare consolidation worksheet for Giant and Small for the year ending December 31, 2018.
4. If Giant determined that the entire amount of goodwill from its investment in Small was impaired in 2018, what journal entry would Giant make to record such impairment?