House Corporation has been operating profitably since its creation in 1960. At the beginning of 2016, House acquired a 70 percent ownership in Wilson Company. At the acquisition date, House prepared the following fair-value allocation schedule:

Consideration transferred for 70% interest in Wilson $ 766,500

Fair value of the 30% noncontrolling interest 328,500

Wilson business fair value $ 1,095,000

Wilson book value 744,000

Excess fair value over book value $ 351,000

Assignments to adjust Wilson's assets to fair value:

To buildings (20-year remaining life) $ 82,000

To equipment (4-year remaining life) (27,400 )

To franchises (10-year remaining life) 83,000 137,600

To goodwill (indefinite life) $ 213,400

House regularly buys inventory from Wilson at a markup of 25 percent more than cost. House's purchases during 2016 and 2017 and related ending inventory balances follow:

Intra-Entity Remaing Intra-entity

Year Purchases InventoryEnd of Year (at transfer price)

2016 $120,000 $40,000

2017 150,000 60,000

On January 1, 2018, House and Wilson acted together as co-acquirers of 80 percent of Cuddy Company's outstanding common stock. The total price of these shares was $312,800, indicating neither goodwill nor other specific fair-value allocations. Each company put up one-half of the consideration transferred. During 2018, House acquired additional inventory from Wilson at a price of $284,000. Of this merchandise, 45 percent is still held at year-end.

House Corporation Wilson Company Cuddy Company

Sales and other revenues $(1,026,720) $(783,400) $(361,800)

Cost of goods sold 590,000 317,000 195,000

operating expenses 276,000 274,000 92,800

Income of Wilson Company (134,680) 0 0

Income of Cuddy Company (29,600) (29,600) 0

Net income $(325,000) $(222,000) $(74,000)

Retained earnings, 1/1/18 $(881,000) $(598,000) $(241,000)

Net income (above) (325,000) (222,000) (74,000)

Dividends declared 100,000 96,000 50,000

Retained earnings, 12/31/18 $(1,106,000) $(724,000) $(265,000)

Cash and receivables $22,220 $219,000 $88,000

Inventory 428,000 386,000 102,300

Investment in Wilson Company 948,780 0 0

Investment in Cuddy Company 166,000 166,000 0

Buildings 418,000 334,000 216,000

Equipment 314,000 194,000 92,200

Land 274,000 330,000 19,500

Total assets $2,571,000 $1,629,000 $518,000

Liabilities $(645,000) $(595,000) $(103,000)

Common stock (820,000) (310,000) (150,000)

Retained earnings, 12/31/18 (1,106,000) (724,000) (265,000)

Total liabilities and equities $(2,571,000) $(1,629,000) $(518,000)

Using the three companies' following financial records for 2018, make consolidation worksheet. The partial equity method based on separate company incomes has been applied to each investment.