Homework Saved Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicat Branson paid $563,700 cash for all of the outstanding common stock of Wolfpack, Inc., on January 1, 2020. On that date, the subsidiary had a book value of $365,000 (common stock of $200,000 and retained earnings of $165,000), although various unrecorded royalty agreements (10-year remaining life) were assessed at a $165,000 fair value Any remaining excess fair value was considered goodwill. In negotiating the acquisition price, Branson also promised to pay Wolfpack's former owners an additional $49,000 if Wolfpack's income exceeded $130,000 total over the first two years after the acquisition. At the acquisition date, Branson estimated the probability-adjusted present value of this contingent consideration at $34,300. On December 31, 2020, based on Wolfpack's earnings to date, Branson increased the value of the contingency to $39,200. During the subsequent two years, Wolfpack reported the following amounts for come and dividends: 2020 2021 Net Income $ 68,200 78,200 Dividends Declared $ 10,000 20,000 In keeping with the original acquisition agreement on December 31, 2021. Branson paid the additional $49,000 performance fee to Wolfpack's previous owners Prepare each of the following: o Branson's entry to record the acquisition of the shares of its Wolfpack subsidiary. b. Branson's entries at the end of 2020 and 2021 to adjust its contingent performance obligation for changes in fair value and the December 31, 2021, payment c. Prepare consolidation worksheet entries as of December 31, 2021, assuming that Branson has applied the equity method d. Prepare consolidation worksheet entries as of December 31, 2021, assuming that Branson has applied the initial value method. Answer is not complete Prepare consolidation worksheet entries as of December 31, 2021, assuming that Branson has applied the equity method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Event Accounts Debit Credit 1 01 No Transaction Recorded 2. 02 Common stock - Wolfpack Retained earnings - Wolfpack Investment in Wolfpack 200,000 223,200 423,200 3 03 Royalty agreements Goodwill Investment in Wolfpack 148,500 51,800 200,300 X 4 04 Equity earnings of Wolfpack Investment in Wolfpack 61,700 61.700 5 05 Investment in Wolfpack Dividends declared 20,000 20.000 6 06 Amortization expense Royalty agreements 16,500 16.500 Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Prepare consolidation worksheet entries as of December 31, 2021, assuming that Branson has applied the initial value method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.). No Event Debit Credit 2 02 Accounts Investment in Wolfpack Retained earnings - Branson 61,700 X X 61,700 X 3 03 Royalty agreements Goodwill Investment in Wolfpack 148,000 $ 51.800 X 200,300 X 4 04 X Common stock - Wolfpack Retained earnings - Wolfpack Investment in Wolfpack 200.000 X 223,200 $ X X 423,200 X 5 05 Dividend income Dividends declared X 20,000 $ X 20.000 X 6 06 Amortization expense Royalty agreements 16,500 16.500 Donicode