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On January 1 , 2 0 2 3 , Corgan Company acquired 8 0 percent of the outstanding voting stock of Smashing, Incorporated, for a

On January 1,2023, Corgan Company acquired 80 percent of the outstanding voting stock of Smashing, Incorporated, for a total of $840,000 in cash and other consideration. At the acquisition date, Smashing had common stock of $720,000, retained earnings of $270,000, and a noncontrolling interest fair value of $210,000. Corgan attributed the excess of fair value over Smashing's book value to various covenants with a 20-year remaining life. Corgan uses the equity method to account for its investment in Smashing.
During the next two years, Smashing reported the following:
\table[[Items,Net Income,\table[[Dividends],[Declared]],\table[[Inventory Purchases],[from Corgan]]],[2023,$170,000,$37,000,$120,000
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