On January 1, 2016, Aspen Company acquired 80 percent of Birch Company's voting stock for $372,000. Birch reported a $360,000 book value and the fair value of the noncontrolling interest was $93,000 on that date. Then, on January 1, 2017, Birch acquired 80 percent of Cedar Company for $180,000 when Cedar had a $126,000 book value and the 20 percent noncontrolling interest was valued at $45,000. In each acquisition, the subsidiary's excess acquisition-date fair over book value was assigned to a trade name with a 30-year remaining life.

These companies report the following financial information. Investment income figures are not included.

2016 2017 2018

Sales:

Aspen Company $517,500 $655,000 $910,000

Birch Company 272,000 344,250 575,400

Cedar Company Not available 171,900 288,600

Expenses:

Aspen Company $425,000 $545,000 $747,500

Birch Company 231,000 266,000 495,000

Cedar Company Not available 161,000 249,000

Dividends declared:

Aspen Company $18,000 $35,000 $45,000

Birch Company 5,000 15,000 15,000

Cedar Company Not available 3,000 8,000

Assume that each of the following questions is independent:

1. If all companies use the equity method for internal reporting purposes, what is the December 31, 2017, balance in Aspen's Investment in Birch Company account?
2. What is the consolidated net income for this business combination for 2018?
3. What is the net income attributable to the noncontrolling interest in 2018?
4. Assume that Birch made intra-entity inventory transfers to Aspen that have resulted in the following intra-entity gross profits in inventory at the end of each year:

Date Amount

12/31/16 $14,300

12/31/17 23,600

12/31/18 32,000

What is the accrual-based net income of Birch in 2017 and 2018, respectively?