On January 1, 2019 Pet Company acquired 100% of Subsidiary Company's common stock for $2,030,000.At that date, the book value of Subsidiary Company's net assets was $1,550,000.The book values and the fair values of the Subsidiary's assets and liabilities were generally the same, with the following exceptions:

building bookvalue: 1,400,000

fairvalue: 1,570,000

useful life : 8

customerlist bookvalue: o

fairvalue 160,000

useful life: 4

liabilities bookvalue: (750000)

fairvalue:(787,500)

useful life: 5

Pet uses the equity method to account for its investment in Subsidiary.The following information was taken from the Consolidation worksheet for Pet and Subsidiary at December 31, 2021:

Income Statement

Pet

depreciation expense 495,000

Interest Expense 150,000

Subsidiary

Depreciation expense 275,000

interest expense 75,000

Balance Sheet

Building (net)

pet - 6,000,000

subsidiary - 1,400,000

Customer lists

pet - 115,000

subsidiary - -0-

Liabilities

pet - (330,000)

subsidiary - (750,000)

A.Prepare Pet's acquisition-date fair-value allocation schedule for its investment in Subsidiary.That is, compute the excess of fair value over book value as of the date of purchase and show how that excess should be allocated.

B.Compute the dollar amounts at which each of the following items would be reported in the consolidated financial statements for the year ending December 31, 2021.Show your calculations.

1.Building (net)

2.Customer Lists

3.Goodwill

4.Liabilities

5.Depreciation Expense

6.Interest Expense