On January 1, 2020, Holland Corporation paid $8 per share to a group of Zeeland Corporation shareholders to acquire 60,000 shares of Zeelands outstanding voting stock, representing a 60 percent ownership interest. The remaining 40,000 shares of Zeeland continued to trade in the market close to its recent average of $6.00 per share both before and after the acquisition by Holland. Zeelands acquisition date balance sheet follows: Current assets $ 14,500 Liabilities $ 219,500 Property and equipment (net) 248,500 Common stock 100,000 Patents 196,500 Retained earnings 140,000 $ 459,500 $ 459,500 On January 1, 2020, Holland assessed the carrying amount of Zeelands equipment (5-year remaining life) to be undervalued by $60,000. Holland also determined that Zeeland possessed unrecorded patents (10-year remaining life) worth $290,600. Zeelands acquisition-date fair values for its current assets and liabilities were equal to their carrying amounts. Any remaining excess of Zeelands acquisition-date fair value over its book value was attributed to goodwill. The companies financial statements for the year ending December 31, 2021, follow: Holland Zeeland Sales $ (699,000 ) $ (433,500 ) Cost of goods sold 354,500 202,500 Depreciation expense 87,500 33,500 Amortization expense 14,500 20,500 Other operating expenses 54,000 62,000 Equity in Zeeland earnings (44,364 ) 0 Separate company net income $ (232,864 ) $ (115,000 ) Retained earnings 1/1 $ (820,700 ) $ (310,000 ) Net income (232,864 ) (115,000 ) Dividends declared 50,000 30,000 Retained earnings 12/31 $ (1,003,564 ) $ (395,000 ) Current assets $ 125,500 $ 86,500 Investment in Zeeland 583,728 0 Property and equipment (net) 842,000 264,000 Patents 150,000 152,500 Total assets $ 1,701,228 $ 503,000 Liabilities $ (377,664 ) $ (8,000 ) Common stockHolland (320,000 ) 0 Common stockZeeland 0 (100,000 ) Retained earnings 12/31 (1,003,564 ) (395,000 ) Total liabilities and owners equity $ (1,701,228 ) $ (503,000 ) At year-end, there were no intra-entity receivables or payables. Compute the amount of goodwill recognized in Hollands acquisition of Zeeland and the allocation of goodwill to the controlling and noncontrolling interest. Show how Holland determined its December 31, 2021, Investment in Zeeland account balance. Prepare a worksheet to determine the amounts that should appear on Hollands December 31, 2021, consolidated financial statements.

On January 1, 2020, Holland Corporation paid $8 per share to a group of Zeeland Corporation shareholders to acquire 60,000 shares of Zeeland's outstanding voting stock, representing a 60 percent ownership interest. The remaining 40,000 shares of Zeeland continued to trade in the market close to its recent average of $6.00 per share both before and after the acquisition by Holland. Zeeland's acquisition date balance sheet follows: Current assets Property and equipment (net) Patents $ 14,500 248,500 196,500 $ 459,500 Liabilities Common stock Retained earnings $ 219,500 100,000 140,000 $ 459,500 On January 1, 2020, Holland assessed the carrying amount of Zeeland's equipment (5-year remaining life) to be undervalued by $60,000. Holland also determined that Zeeland possessed unrecorded patents (10-year remaining life) worth $290,600. Zeeland's acquisition-date fair values for its current assets and liabilities were equal to their carrying amounts. Any remaining excess of Zeeland's acquisition-date fair value over its book value was attributed to goodwill. The companies' financial statements for the year ending December 31, 2021, follow: $ Sales Cost of goods sold Depreciation expense Amortization expense Other operating expenses Equity in Zeeland earnings Separate company net income Holland (699,000) 354,500 87,500 14,500 54,000 (44,364) (232, 864) Zeeland $ (433,500) 202,500 33,500 20,500 62,000 0 $ (115, 000) $ Retained earnings 1/1 Net income Dividends declared Retained earnings 12/31 $ (820, 700) (232, 864) 50,000 $(1,003,564) $ (310,000) (115, 000) 30,000 $ (395,000) Current assets Investment in Zeeland Property and equipment (net) Patents Total assets $ 125,500 583,728 842,000 150,000 $ 1,701, 228 $ 86,500 0 264,000 152,500 $ 503,000 $ Sales Cost of goods sold Depreciation expense Amortization expense Other operating expenses Equity in Zeeland earnings Separate company net income Holland (699,000) 354,500 87,500 14,500 54,000 (44,364) (232, 864) Zeeland $ (433, 500) 202,500 33,500 20,500 62,000 0 $ (115,000) $ Retained earnings 1/1 Net income Dividends declared Retained earnings 12/31 $ (820, 700) (232,864) 50,000 $(1,003,564) $ (310,000) (115,000) 30,000 $ (395,000) Current assets Investment in Zeeland Property and equipment (net) Patents $ 125,500 583,728 842,000 150,000 $ 1,701, 228 $ 86,500 0 264,000 152,500 $ 503,000 Total assets Liabilities Common stock-Holland Common stock-Zeeland Retained earnings 12/31 Total liabilities and owners equity $ (377,664) (320,000) 0 (1,003,564) $(1,701,228) $ (8,000) 0 (100,000) (395,000) $ (503, 000) At year-end, there were no intra-entity receivables or payables. a. Compute the amount of goodwill recognized in Holland's acquisition of Zeeland and the allocation of goodwill to the controlling and noncontrolling interest. b. Show how Holland determined its December 31, 2021, Investment in Zeeland account balance. c. Prepare a worksheet to determine the amounts that should appear on Holland's December 31, 2021, consolidated financial statements. Complete this question by entering your answers in the tabs below. Req A and B Reqc a. Compute the amount of goodwill recognized in Holland's acquisition of Zeeland and the allocation of goodwill to the controlling and noncontrolling interest. b. Show how Holland determined its December 31, 2021, Investment in Zeeland account balance. (Negative amounts should be shown with a minus sign.) Show less Amount a 1. Goodwill Controlling Interest NCI a2. Goodwill allocation Amount b. Initial Value Change in Zeeland's RE Excess amortization Investment in Zeeland $ 0 Consolidated Noncontrolling Interest Accounts Totals For Year Ending December 31, 2021 Consolidation Entries Holland Zeeland Debit Credit $ (699,000) $ (433,500) 354,500 202,500 87,500 33,500 14,500 20,500 54,000 62,000 (44,364) $ (232,864) $ (115,000) 0 Sales Cost of goods sold Depreciation expense Amortization expense Other operating expenses Equity in Zeeland earnings Separate company net income Consolidated net income Noncontrolling interest in CNI Controlling interest net income Retained earnings 1/1 Net income Dividends declared Retained earnings 12/31 Current assets Investment in Zeeland, Inc Property and equipment (net) Patents Goodwill $ (820,700) $ (310,000) (232,864) (115,000) 50,000 30,000 $ (1,003,564) $ (395,000) $ 125,500 $ 86,500 583,728 0 842.000 264,000 150,000 152,500 0 0 $ 1,701,228 $ 503,000 (377,664) (8,000) (320,000) (100,000) Total assets Liabilities Common stock Noncontrolling interest Retained earnings 12/31 Total liabilities and equities (1,003,564) (395,000) $ (1,701,228) $ (503,000) $ 0 $ 0