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On January 1, 2020, Panther, Inc., issued securities with a total fair value of $577,000 for 100 percent of Stark Corporation's outstanding ownership shares. Stark

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On January 1, 2020, Panther, Inc., issued securities with a total fair value of $577,000 for 100 percent of Stark Corporation's outstanding ownership shares. Stark has long supplied inventory to Panther. The companies expect to achieve synergies with production scheduling and product development with this combination. Although Stark's book value at the acquisition date was $300,000, the fair value of its trademarks was assessed to be $45,000 more than their carrying amounts. Additionally, Stark's patented technology was undervalued in its accounting records by $232,000. The trademarks were considered to have indefinite lives, and the estimated remaining life of the patented technology was eight years. In 2020, Stark sold Panther inventory costing $75,000 for $125,000. As of December 31,2020, Panther had resold 74 percent of this inventory. In 2021, Panther bought from Stark $140,000 of inventory that had an original cost of $70,000. At the end of 2021, Panther held $38,000 (transfer price) of inventory acquired from Stark, all from its 2021 purchases. During 2021, Panther sold Stark a parcel of land for $88,000 and recorded a gain of $16,000 on the sale. Stark still owes Panther $62,000 (current liability) related to the land sale. At the end of 2021, Panther and Stark prepared the following statements for consolidation. a. Show how Panther computed its $39,000 equity in Stark's earnings balance. b. Prepare a 2021 consolidated worksheet for Panther and Stark. Show how Panther computed its $39,000 equity in Stark's earnings balance. (Input all amounts as positive values.) \begin{tabular}{|l|l|} \hline \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline \end{tabular} Required B Prepare a 2021 consolidated worksheet for Panther and Stark. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet. Input all amounts as positive values.)

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