On January 1, 2020, Hi-Speed.com acquired 100 percent of the common stock of Wi-Free Co. for cash of $730,000. The consideration transferred was allocated among Wi-Frees net assets as follow:

Wi-Free fair value (cash paid by Hi-Speed)		$730,000
Book value of Wi-Free:
Common stock and additional paid-in capital (APIC)	$130,000
Retained earnings	370,000	500,000
Excess fair value over book value to		230,000
In-process R&D	$75,000
Computer software (overvalued)	(30,000)
Internet domain name	120,000	165,000
Goodwill		$65,000

At the acquisition date, the computer software had a 4-year remaining life, and the Internet domain name was estimated to have a 10-year remaining life. By the end of 2020, it became clear that the acquired in-process research and development would yield no economic benefits and Hi-Speed.com recognized an impairment loss. At December 31, 2021, Wi-Frees accounts payable included a $30,000 amount owed to Hi-Speed.

The December 31, 2021, trial balances for the parent and subsidiary follow:

Table Summary: First row is a header row and has no data over the first column.

Hi-Speed.com Wi-Free Co. Revenues $(1,100,000) $(325,000) Cost of goods sold 625,000 122,000 Depreciation expense 140,000 12,000 Amortization expense 50,000 11,000 Equity in subsidiary earnings (175,500) 0 Net income $(460,500) $(180,000) Retained earnings 1/1/21 $(1,552,500) $(450,000) Net income (460,500) (180,000) Dividends declared 250,000 50,000 Retained earnings 12/31/21 $(1,763,000) $(580,000) Current assets $1,034,000 $345,000 Investment in Wi-Free 856,000 0 Equipment (net) 713,000 305,000 Computer software 650,000 130,000 Internet domain name 0 100,000 Goodwill 0 0 Total assets $3,253,000 $880,000 Liabilities $(870,000) $(170,000) Common stock (500,000) (110,000) Additional paid-in capital (120,000) (20,000) Retained earnings 12/31/21 (1,763,000) (580,000) Total liabilities and equity $(3,253,000) $(880,000)

Required

Using Excel, prepare calculations showing how Hi-Speed derived the $856,000 amount for its investment in Wi-Free.

Using Excel, compute consolidated balances for Hi-Speed and Wi-Free. Either use a worksheet approach or compute the balances directly.