Kraus Company has the following balance sheet on July 1, 2016:

Assets Liabilities and Equity

Current Assets	$200,000	Current Liabilities	$100,000
Equipment (net)	300,000	Common Stock ($10 par)	100,000
		Retained Earnings	300,000
Total Assets	$500,000	Total Liabilities and Equity	$500,000

On July 1, 2016, Neiman Company purchases 80% of the outstanding common stock of Kraus Company for $310,000. Any excess of book value over cost is attributed to the equipment, which has an estimated 5-year life. Kraus Company closes its books before the acquisition on July 1.

On December 31, 2016, Neiman Company and Kraus Company prepare the following trial balances:

Neiman Kraus (July 1-December 31)

Current Assets	220,000	220,000
Equipment	500,000	300,000
Accumulated Depreciation-Equipment	(140,000)	(20,000)
Investment in Kraus Company	310,000
Current Liabilities	(200,000)	(70,000)
Common Stock ($10 par)	(200,000)	(100,000)
Retained Earnings, July 1, 2016	(430,000)	(300,000)
Sales	(300,000)	(100,000)
Cost of Goods Sold	180,000	45,000
General Expenses	60,000	25,000
Totals	0	0

1. Prepare a determination and distribution of excess schedule for the investment (a value analysis is not needed).

2. Prepare all the eliminations and adjustments that would be made on the December 31, 2016, consolidated worksheet.

3. Prepare the 2016 consolidated income statement and its related income distribution schedules.