II. Consolidation:

II. Consolidation: Outside Ownership ( 30 points): On January 1,2021, Perch Company purchased an 80% interest in the capital stock of Salmon Company for $3,400,000. At that time, Salmon Company had common stock of $2,200,000 and retained earnings of $620,000. Perch Company uses the equity method to record its investment in Salmon Company. Differences between the fair value and the book value of the identifiable assets of Salmon Company were as follows: The book values of all other assets and liabilities of Salmon Company were equal to their fair values on January 1,2021. The equipment had a remaining life of five years on January 1,2021; the inventory was sold in 2021. Salmon Company's net income and dividends declared in 2021 were as follows: Year 2021 Net Income of \$400,000; Dividends Declared of \$100,000 PERCH COMPANY AND SUBSIDIARY TRIAL BALANCES For the Year Ended December 31, 2022 REQUIRED: 1. Prepare the working paper entries to consolidate the December 31,2022 trial balances of Perch and Salmon. 2. Calculate the NCI's share Salmon's Net Income and the consolidated NCI balance