On January 1, 2014, Baldwin Company acquired a 80% interest in Knapp Company for a purchase price that was $125,000 over the book value of the Knapps Stockholders Equity on the acquisition date. Baldwin allocated the excess to the following [A] assets:

[A] Asset	Initial Fair Value	Useful Life (years)
PPE, net	50,000	20
Patent	75,000	15
	$125,000

Knapp sells inventory to Baldwin (upstream) which Baldwin, ultimately, sells to customers outside of the controlled group. You have compiled the following data for the years ending 2016 and 2017:

	2016	2017
Transfer price for inventory sale	$62,675	$85,300
Cost of goods sold	(45,175)	(65,300)
Gross profit	$17,500	$20,000
% inventory remaining	20%	30%
Gross profit deferred	$ 3,500	$ 6,000
EOY Receivable/Payable	$22,500	$25,000

The inventory not remaining at the end of the year has been sold outside of the controlled group.

The parent and the subsidiary report the following financial statements at December 31, 2017:

Income Statement
	Baldwin	Knapp
Sales	$3,270,000	$312,375
Cost of goods sold	(2,289,000)	(187,425)
Gross Profit	981,000	124,950
Equity investment income	26,986
Operating expenses	(621,300)	(81,217)
Net income	$ 386,686	$ 43,733

Statement of Retained Earnings
	Baldwin	Knapp
BOY Retained Earnings	$1,595,468	$161,394
Net income	386,686	43,733
Dividends	(123,600)	(4,374)
EOY Retained Earnings	$1,858,554	$200,753

Balance Sheet
	Baldwin	Knapp
Assets:
Cash	$ 229,410	$ 12,585
Accounts receivable	118,650	72,471
Inventory	334,161	93,088
Equity Investment	270,802
PPE, net	3,051,564	165,859
	$4,287,389	$344,003
Liabilities and Stockholders Equity:
Current Liabilities	$ 469,899	$ 87,000
Long-term Liabilities	744,184	0
Common Stock	534,645	25,000
APIC	397,305	31,250
Retained Earnings	1,858,554	200,753
	$4,004,587	$344,003

Required:

a. Compute the EOY noncontrolling interest equity balance

b. Prepare the consolidation journal entries.