On 1/1/20x1, Petwoud Company exchanged 500,000 shares of its $1 par value common stock and $5,550,000 cash to acquire 70% of the outstanding voting common stock of Supagud, Inc. At the acquisition date, the fair value of Petwoud Companys common stock was $14.90 per share.

Other investors, unrelated to Petwoud Company, hold the remaining outstanding common stock of Supagud.

Petwouds acquisition price was equal to the fair value of Supagud at 1/1/20x1. Thus, per share fair value of the noncontrolling interest did not differ from that of Petwoud.

After the acquisition, Supagud, Inc. will continue as a separate operating company. Additionally, in its separate accounting records, Petwoud Company will apply the equity method to account for their investment in Supagud.

At 1/1/20x1, Supaguds shareholders equity amounts were as follows:

Common stock		$15,000,000
Retained earnings		$1,970,000

In conjunction with the acquisition, Supagud held the following assets with fair values that differed significantly from their recorded amounts:

	Recorded Value	Fair Value @ 1/1/20x1	Remaining Useful Life (in years)
Land	$1,700,000	$2,550,000
Buildings (seven-year remaining life)	2,700,000	3,400,000	7
Equipment (five-year remaining life)	3,700,000	3,300,000	5

During fiscal year 20x1, Supaguds 20x1 net income and dividends declared and paid were:

Net income	$550,000
Dividends declared and paid	$140,000

Supagud did not issue common stock during fiscal year 20x1.

Required

1. Prepare the journal entry to record Petwoud Companys investment in Supagud, Inc. at 1/1/20x1.
2. Prepare a schedule showing the allocation of the purchase price to the fair value of the net assets acquired, including periodic depreciation/amortizations of the related purchase price adjustments.
3. Prepare a schedule showing the computation of goodwill recorded at acquisition, if any.
4. Prepare the worksheet consolidation journal entries for fiscal year-ending 12/31/20x1.