On January 1, 2020, P company acquires 90 percent of the outstaniding common stock of S company, in exchange for $1,710,000 cash.

At the acquisition date, S company's total fair value, including the noncontrolling interest, was assessed at $1,900,000. Also at the acquisition date,

S company's book value was $725,000.(common stock 400,000, additional paid-in capital 60,000, retained earnings 265,000)

P company observed that S company had developed internally a customer base with an assed fair value of $800,000 that was not reflected on S company's books. The remaining useful life of cutomer base is ten years.

Book value

Fair value

Customer base

0

800000

For internal reporting purposes, P company employs the equity method to account for this investment. The following account balances are for the year

ending December 31, 2020, for both companies. At year-end, there were no intra-entity receivables or payables.

P company

S company

Revenues

($120,000)

($120,000)

Cost of goods sold

40,000

40,000

Depreciation expense

Amortization expense

Equity in income of Gardena

($121,500)

0

Net income

($437,000)

($215,000)

Retained earnings (1/1/2020)

($330,000)

($265,000)

Net income

($437,000)

($215,000)

Dividends declared

350,000

25,000

Retained earnings (12/31/2020)

Current assets

Investment in S company

1,854,000

0

Trademark

Property and equipment (net)

Patents

Total assets

Accounts payable

Common stock

($900,000)

($400,000)

Additional paid-in capital

($300,000)

($60,000)

Retained earnings (12/31/2020)

Total liabilities and equities

1. What is the goodwill of Gardena at acquisition?

2.What is the amount of Non-Controlling Interest at acquisition

3. The consolidation JE D to eliminate any dividend earned from Subsidiary during 2020 (consolidation JE D)

(1/1/2020)?

4. The consolidation JE S to eliminate subsidiarys stockholders' equity at December 31, 2020 (consolidation JE S)

5. What is the consolidated balance for investment at December 31, 2020?