Miller Company acquired an $80$ percent interest in Taylor Company on January $1,2019.$ Miller paid $$856,000$ in cash to the owners of Taylor to acquire these shares. In addition, the remaining $20$ percent of Taylor shares continued to trade at a total value of $$214,000$ both before and after Miller$$s acquisition.

On January $1,2019,$ Taylor reported a book value of $$752,000($Common Stock $=$ $$376,000$; Additional Paid$-$In Capital $=$ $$112,800$; Retained Earnings $=$ $$263,200).$ Several of Taylor$$s buildings that had a remaining life of $20$ years were undervalued by a total of $$100,300.$

During the next three years, Taylor reports income and declares dividends as follows:

Year Net Income Dividends

$2019$ $ $87,800$ $ $12,500$

$2020112,50018,800$

$2021125,30025,100$

Determine the appropriate answers for each of the following questions:

What amount of excess depreciation expense should be recognized in the consolidated financial statements for the initial years following this acquisition?

If a consolidated balance sheet is prepared as of January $1,2019,$ what amount of goodwill should be recognized?

If a consolidation worksheet is prepared as of January $1,2019,$ what Entry S and Entry A should be included?

On the separate financial records of the parent company, what amount of investment income would be reported for $2019$ under each of the following accounting methods?

The equity method.

The partial equity method.

The initial value method.

On the parent company$$s separate financial records, what would be the December $31,2021,$ balance for the Investment in Taylor Company account under each of the following accounting methods?

The equity method.

The partial equity method.

The initial value method.

As of December $31,2020,$ Miller$$s Buildings account on its separate records has a balance of $$1,004,000$ and Taylor has a similar account with a $$376,500$ balance. What is the consolidated balance for the Buildings account?

What is the balance of consolidated goodwill as of December $31,2021?$

Assume that the parent company has been applying the equity method to this investment. On December $31,2021,$ the separate financial statements for the two companies present the following information:

Miller Company Taylor Company

Common stock $ $627,500$ $ $376,000$

Additional paid$-$in capital $351,400112,800$

Retained earnings, $12/31/21778,100532,400$

What will be the consolidated balance of each of these accounts?