On January 1, 2020. Procise Corporation acquired 100 percent of the outstanding voting stock of Gaugerite Corporation for $2005,200 cash. On the acquisition date, Gauge Rite had the following balance sheet Cash Accounts receivable Land Equipment (net) Total assets 5 16,000 145,000 755.ee 1,928 bee $ 2,846.000 Accounts payable Long-term debt Connon stock Retained earnings Total liabilities and equity $191,000 943.ee 1,058,00 652.ee $ 2,845.000 At the acquisition date the following allocation was prepared Fair value of consideration transferred Book value acquired Excess falr value over book value To in-process research and development To equipment (S-year remaining life) To goodwill indefinite life) 564,000 91 209 $ 2, ees, 2e0 1,210,000 295, 200 155,200 140. eee Although at acquisition date Procise had expected $64,000 in future benefits from GaugeRite's in-process research and development project. by the end of 2020 it was apparent that the research project was a failure with no future economic benefits. On December 31, 2021. Procise and Gaugerito submitted the following financial statements for consolidation. There were no intra- entity payables on that date Procise Gaute Sales $ 0,849,48) $(1,385,580) Cost of goods sold 1,792,500 872, see Depreciation expense 335,880 132,000 Other operating expenses 221,589 33,00 Subsidiary income (256,689) Net Income $(1.755,00) $(268,00) Retained earnings 1/1/21 $ (3,892, See) (896,600) Net Income (1,755,000) (268,000) Dividends declared 300,000 26.450 Retained earnings 12/21/21 $ (4,547,500) $(1,137,550) Cash 88,550 57.550 Accounts receivable 886,080 241,00 Inventory 974.000 823,00 Investnent in agrite 2,483,950 Land 3,170,000 710.000 Equipment (net) 5.185.000 1,750,000 $ $ $ Net income Retained earnings 1/1/21 Net income Dividends declared Retained earnings 12/31/21 Cash Accounts receivable Inventory Investnent in Gaugerite Land Equipment (net) Goodwill Total assets Accounts payable Long-term debt Common stock Retained earnings 12/31/21 Total liabilities and equity $ (1,755,688) $ (3,892,580) (1,755,880) 380,000 $ (4,547,580) $ 88,55 886,800 974,888 2,483,950 3,178,880 5,185,800 332.000 $ 13,039,582 $ (217,888) (3,125,808) (5,150,000) (4.547,589) $(13,639,589) $ (268, e88) $ (896,000) (268,088) 26,450 $(1,137,558) $ 57,558 241, eee 883, eee 0 710,288 1,750, eee 8 $ 3,561,550 $ (496,000) (870,000) (1, e38,288) (1,137,558) $(3,561,558) a. Show how Procise derived its December 31, 2021. Investment in GaugeRite account balance. c. Prepare a consolidated worksheet for Procise and Gaugerite as of December 31, 2021. Complete this question by entering your answers in the tabs below. Required A Required Show how Procise derived its December 31, 2021, Investment in Gaugerite account balance. (Amounts to be deducted should be indicated by a minus sign.) Amounts Consideration transferred 1/1/20 Required A Required c Prepare a consolidated worksheet for Procise and GaugeRite as of December 31, 2021. (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. Amounts in the Debit and Credit columns should be entered as positive. Input all amounts as positive values.) Show less Accounts Consolidated Totals Sales Cost of goods sold Depreciation expense Other operating expenses Subsidiary income Net Income Procise and Subsidiary GaugeRite Consolidated Worksheet for the year ended December 31, 2021 Consolidation Entries 12/31/21 12/31/21 Procise GaugeRite Debit Credit S (3.849,400) $ (1,305,500) 1,792,500 872,500 335,000 132,000 223,500 33,000 (258,800) 0 S (1.755.000) $ 268,000 Retained earnings 1/1/21 Net Income Dividends declared Retained earnings 12/3121 $ (3,092,500) 5 (896,000) (1.755,000) (268,000) 300,000 26,450 S (4.547,500) $ (1,137,560) Cash Accounts receivable Inventory Investment in GaugeRite Land Equipment (net) Goodwill Total assets S 88,550 $ 57,550 888,000 241,000 974,000 803,000 2,403,950 0 3,170,000 710,000 5,185,000 1,750,000 332,000 0 S 13.039,500 $ 3,581,550 $ 14,405,500 Accounts payable S (217,000) 5 (498,000) Depreciation expense Other operating expenses Subsidiary income Net Income 335.000 223.500 (258.600) $ (1.755,000) 5 132,000 33.000 0 268,000 Retained earnings 1/121 Net Income Dividends declared Retained earnings 12/3121 5 3.092.500 5 (896,000) (1.755.000) 268.000 300,000 26,450 S (4.547,500) 5 (1.137,550) Cash Accounts receivable Inventory Investment in Gaugerite Land Equipment (net) Goodwil Total assets $ 83,550 $ 57,550 888.000 241,000 974.000 803,000 2.403,950 0 2.170.000 710,000 5.185,000 1.750,000 332.000 0 $ 13.039,500 3 3,581,550 S 14.405,500 Accounts payable Long-term debt Common stock-Procise Common stock ---Gaugerite Retained earnings 12/31/21 Total liabilities and equity $ 217,000) $ (498,000) 3.125,000) (870.000) (5.150,000) (1.058,000) (4547,500) (1.137,660) $(13,039,800) 5 (3.501,860) 3 05 0 $ 14,406,600