On January 1, 2017, Dirt Company acquired all of Cat Company's voting stock for $16,000 in cash. Some of Cat's identifiable assets at the date of acquisition had fair values that are different from reported values, as follows:

	Fair Value	Book Value
Plant assets, net (20-year remaining life, straight-line)	3,000	11,000
Identifiable intangibles that should be capitalized (5-year remaining life, straight-line)	10,000	0

Cat's total shareholders' equity at January 1, 2017, was $4,000. It is now December 31, 2020 (four years later). Cumulative impairment for the goodwill recognized on this acquisition, to the beginning of 2020, is $2,000. Goodwill impairment for 2020 is $500. Dirt uses the complete equity method to account for its investment in Cat Company on its own books.

December 31, 2020 trial balances for Dirt and Cat appear below

	Dirt Company	Cat Company
	DR (CR)	DR (CR)
Current Assets	5,000	2,500
Plant assets, net	34,800	28,000
Investment in Cat Company	23,600
Liabilities	(22,000)	(10,000)
Capital Stock	(15,000)	(2,000)
Retained Earnings, Jan. 1	(25,000)	(16,000)
Sales Revenue	(25,000)	(14,000)
Equity in net income of Cat	(400)
Cost of Sales	20,000	8,000
Operating Expenses	4,000	3,500
Total	0	0

Required:

A. Compute goodwill at acquisition.

B. Prepare the working paper to consolidate Dirt and Cat's trial balances at December 31, 2020. Must designate the elimination entries appropriately (C), (E), (R), and (O).

C. Prepare the consolidated income statement for 2020 and the consolidated balance sheet at December 31, 2020 in good form