On January 1, 2017, Parent Company purchased an 80% interest in the capital stock of Subsidiary Company for $3,060,000. At that time, Subsidiary Company had common stock of $1,980,000 and retained earnings of $558,000. Parent Company uses the equity method to record its investment in Subsidiary Company. Differences between the fair value and the book value of the identifiable assets of Subsidiary Company were as follows:

Fair Value in Excess of Book Value

Equipment $360,000

Land 180,000

Inventory 72,000

The book values of all other assets and liabilities of Subsidiary Company were equal to their fair values on January 1, 2017. The equipment had a remaining life of five years on January 1, 2017; the inventory was sold in 2017.

Subsidiary Companys net income and dividends declared in 2017 were as follows:

Year 2017 Net Income of $360,000; Dividends Declared of $90,000

Required:

Calculate and enter Equity in Net Income to Parent's column. Prepare a consolidated statements workpaper for the year ended December 31, 2018 using the partially completed worksheet.

			Adjustments
	Parent	Subsidiary	Dr.	Cr.	Consolidated
Cash	252,000	234,000
Accounts Receivable	936,000	684,000
Inventory	864,000	630,000
Investment in Subsidiary Company	3,420,000
Land		1,152,000
Plant and Equipment	1,296,000	1,008,000
Goodwill
Accounts Payable	(475,200)	(396,000)
Notes Payable	(324,000)	(108,000)
Common Stock	(3,600,000)	(1,980,000)
Retained Earnings, Jan 1	(1,900,800)	(828,000)
Noncontrolling Interest
Dividends Declared	324,000	216,000
Sales	(3,960,000)	(1,620,000)
Equity in Net Income of Subsidiary
Cost of Goods Sold	3,240,000	720,000
Depreciation Expense	144,000	108,000
Other Expenses	216,000	180,000
Noncontrolling Interest in Net Income
	$0	$0