On 1/1/2016, XYZ Corporation purchased 75% of the outstanding voting stock of Sally Corporation for $2,400,000 paid in cash. On the date of the acquisition, Sally’s shareholders’ equity consisted of the following:

Common stock, $10 par $1,000,000

APIC 600,000

Retained Earnings 800,000

Total SE $2,400,000

The excess fair value of the net assets acquired was assigned 10% to undervalued Inventory (sold in 2016), 40% to undervalued PPE assets with a remaining useful life of 8 years, and 50% to Goodwill.

Comparative trial balances of XYZ Corporation and Sally Corporation at December 31, 2020, are as follows:

	California	San Diego
Other assets – net	3,765,000	2,600,000
Investment in Sally	2,340,000	-
Expenses (including cost of sales)	3,185,000	600,000
Dividends	500,000	200,000
	9,790,000	3,400,000
Common Stock, $10 par value	(3,000,000)	(1,000,000)
APIC	(850,000)	(600,000)
Retained earnings	(1,670,000)	(800,000)
Sales revenues	(4,000,000)	(1,000,000)
Income from Sally	(270,000)	-
	(9,790,000)	(3,400,000)

Required:

Determine the amounts that would appear in the consolidated financial statements of XYZ Corporation and its subsidiary for each of the following items:

1. Goodwill at December 31, 2020. (2 points)
2. Income to Non-controlling interest for 2020. (3 points)
3. Consolidated retained earnings at December 31, 2019. (2 points)
4. Consolidated retained earnings at December 31, 2020. (2 points)
5. Controlling share of consolidated Net Income for 2020. (3 points)
6. Non-controlling interest at December 31, 2020. (3 points)