On January 1, 2020, McIlroy, Inc., acquired a 60 percent interest in the common stock of Stinson, Inc., for $352,800. Stinson's book value on that date consisted of common stock of $100,000 and retained earnings of $208,500. Also, the acquisition-date fair value of the 40 percent noncontrolling interest was $235,200. The subsidiary held patents (with a 10-year remaining life) that were undervalued within the company's accounting records by $84,400 and an unrecorded customer list (15-year remaining life) assessed at a $60,300 fair value. Any remaining excess acquisition-date fair value was assigned to goodwill. Since acquisition, McIlroy has applied the equity method to its Investment in Stinson account and no goodwill impairment has occurred. At year-end, there are no intra-entity payables or receivables.

Intra-entity inventory sales between the two companies have been made as follows:

Year	Cost to McIlroy	Transfer Price to Stinson	Ending Balance (at transfer price)
2020	$134,700	$168,375	$56,125
2021	112,500	150,000	37,500

The individual financial statements for these two companies as of December 31, 2021, and the year then ended follow:

	McIlroy, Inc.				Stinson, Inc.
Sales	$	(750,000	)		$	(388,000	)
Cost of goods sold		492,900				236,800
Operating expenses		200,810				80,600
Equity in earnings in Stinson		(36,734	)			0
Net income	$	(93,024	)		$	(70,600	)
Retained earnings, 1/1/21	$	(818,600	)		$	(285,000	)
Net income		(93,024	)			(70,600	)
Dividends declared		50,200				20,200
Retained earnings, 12/31/21	$	(861,424	)		$	(335,400	)
Cash and receivables	$	293,300			$	152,700
Inventory		275,500				133,000
Investment in Stinson		404,613				0
Buildings (net)		358,000				207,600
Equipment (net)		255,400				91,000
Patents (net)		0				25,800
Total assets	$	1,586,813			$	610,100
Liabilities	$	(425,389	)		$	(174,700	)
Common stock		(300,000	)			(100,000	)
Retained earnings, 12/31/21		(861,424	)			(335,400	)
Total liabilities and equities	$	(1,586,813	)		$	(610,100	)

Note: Parentheses indicate a credit balance.)

1. Show how McIlroy determined the $404,613 Investment in Stinson account balance. Assume that McIlroy defers 100 percent of downstream intra-entity profits against its share of Stinsons income.

2. Prepare a consolidated worksheet to determine appropriate balances for external financial reporting as of December 31, 2021.

Can someone please answer this!!! Thank you 3000!!!

Show how McIlroy determined the $404,613 Investment in Stinson account balance. Assu of downstream intra-entity profits against its share of Stinson's income. (Amounts to be d minus sign.) $352,800 $ 45,900 Consideration transferred Increase in Stinson's retained earnings 1/1/20 to 1/1/21 Excess fair value amortization 2020 ending inventory profit deferral Mcllroy's equity in earnings of Stinson for 2021 Stinson 2021 dividends declared to Mcllroy Investment account balance 12/31/21 45,900 $ 398,700 Accounts Mcllroy Stinson Debit Credit NCI Consollgateu Totals $ (750,000) $ 492,900 200,810 (36,734) (93,024) (388,000) 236,800 80,600 0 (70,600) $ Sales Cost of goods sold Operating expenses Equity in earnings of Stinson Separate company net income Consolidated net income To noncontrolling interest To Mcllroy, Inc. Retained earnings 1/1/21 Net income Dividends declared Retained earnings 12/31/21 Cash and receivables Inventory Investment in Stinson Buildings (net) Equipment (net) Patents (net) Customer list Goodwill Total assets Liabilities Common stock Noncontrolling interest 1/1/21 Noncontrolling interest 12/31/21 Retained earnings 12/31/21 Total liabilities and equities (285,000) (70,600) 20,200 (335,400) 152,700 133,000 $ (818,600) (93,024) 50,200 (861,424) $ 293,300 $ 275,500 404,613 358,000 255,400 0 0 207,600 91,000 25,800 $ 1,586,813 $ (425,389) (300,000) 610,100 (174,700) (100,000) (861,424) (1,586,813) $ (335,400) (610,100) $ $ 0 $