On January 1, 2020, Travers Company acquired 90 percent of Yarrow Company's outstanding stock for $783,000. The 10 percent noncontrolling interest had an assessed fair value of $87,000 on that date. Any acquisition-date excess fair value over book value was attributed to an unrecorded customer list developed by Yarrow with a remaining life of 15 years. On the same date, Yarrow acquired an 80 percent interest in Stookey Company for $400,000. At the acquisition date, the 20 percent noncontrolling interest fair value was $100,000. Any excess fair value was attributed to a fully amortized copyright that had a remaining life of 10 years. Although both investments are accounted for using the initial value method, neither Yarrow nor Stookey has distributed dividends since the acquisition date. Travers has a policy to declare and pay cash dividends each year equal to 40 percent of its separate company operating earnings. Reported income totals for 2020 follow: Travers Company Yarrow Company Stookey Company $ 370,000 195,000 148,000 The following are the 2021 financial statements for these three companies (credit balances indicated by parentheses). Stookey has transferred numerous amounts of inventory to Yarrow since the takeover amounting to $94,000 (2020) and $117,500 (2021). These transactions include the same markup applicable to Stookey's outside sales. In each year, Yarrow carried 20 percent of this inventory into the succeeding year before disposing of it. An effective tax rate of 21 percent is applicable to all companies. All dividend declarations are paid in the same period. Sales Cost of goods sold Operating expenses Net income Retained earnings, 1/1/21 Net income (above) Dividends declared Retained earnings, 12/31/21 Current assets Investment in Yarrow Company Investment in Stookey Company Land, buildings, and equipment (net) Total assets Travers Company $ (970,000) 517.100 107,700 $ (345,200) $ (770,000) (345,200) 138,080 $ (977,120) $ 486,700 783,000 Yarrow Company $ (653,900) 348,700 87,000 $ (218,200) $ (654,600) (218,200) 0 $ (872,800) $ 414,300 0 400,000 850,000 $ 1.664 300 Stookey Company $ (514,000) 308,400 102,800 $ (102,800) $ (363,000) (102,800 0 $ (465,800) $ 340,700 0 0 515,800 $ 856 500 1,032,300 $ 2302.000 T 9:08 PM 76F Land, buildings, and equipment (net) Total assets Liabilities Common stock Retained earnings, 12/31/21 Total liabilities and equities 1,032,300 $ 2,302,000 $ (824.880) (500,000) (977,120) $ (2,302,000) 850.000 $ 1,664,300 S (483.100) (308,400) (872,800) $ (1,664 300) 515,800 $ 856.500 S (190.700) (200,000) (465.800 $ (856,500) a. Prepare the business combination's 2021 consolidation worksheet; ignore income tax effects b. Determine the amount of income tax for Travers and Yarrow on a consolidated tax return for 2021 c. Determine the amount of Stookey's income tax on a separate tax return for 2021 d. Based on the answers to requirements (b) and (c), what journal entry does this combination make to record 2021 income tax? Complete this question by entering your answers in the tabs below. Req A Req B and C Req D Prepare the business combination's 2021 consolidation worksheet; ignore income tax effects. (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. Round your intermediate and final answer to the nearest whole dollar.) Show less TRAVERS COMPANY AND CONSOLIDATED SUBSIDIARIES Consolidation Worksheet For Year Ending December 31, 2021 Consolidation Entries Travers Yarrow Stookey Debit Credit Company Company Company 970,000 653,900 514,000 Noncontrolling Consolidated Accounts Interest Balance Sales O- Consolidation Entries Noncontrolling Consolidated Accounts Debit Credit Interest Balance Sales Travers Company 970,000 517,100 107.700 345,200 Yarrow Company 653,900 348,700 87,000 218,200 Stookey Company 514,000 308,400 102,800 102,800 0 0 770,000 Cost of goods sold Operating expenses Net income Consolidated net income Net income attributable to NCI (Yarrow) Net income attributable to NCI (Stookey) Net income attributable to Travers Company Retained earnings, 1/1/21: Travers Company Yarrow Company Stookey Company Net income Dividends declared Retained earnings, 12/31/21 Current assets Investment in Yarrow Company Investment in Stookey Company Land, buildings, & equipment (net) Copyright Customer list 654,600 363,000 102,800 218,200 345,200 138,080 977,120 486,700 783,000 0 872,800 414,300 465,800 340,700 400,000 850,000 1,032,300 515,800 Total assets 0 2,302,000 824,880 1,664,300 483,100 856,500 190,700 Liabilities 0 770,000 654,600 363,000 102,800 218,200 Net income attributable to Travers Company Retained earnings, 1/1/21: Travers Company Yarrow Company Stookey Company Net income Dividends declared Retained earnings, 12/31/21 Current assets Investment in Yarrow Company Investment in Stookey Company Land, buildings, & equipment (net) Copyright Customer list 345,200 138,080 977,120 486,700 783,000 0 872,800 414.300 465,800 340,700 400,000 850,000 1,032,300 515,800 Total assets 0 Liabilities 2,302,000 824,880 500,000 977,120 1,664,300 483, 100 308,400 872,800 856,500 190,700 200,000 465,800 Common stock Retained earnings, 12/31/21 (above) Noncontrolling interest in Stookey, 1/1/21 Noncontrolling interest in Yarrow, 1/1/21 Noncontrolling interests in subsidiaries Total liabilities and equities 0 2,302,000 1,664,300 856,500 0 0 a. Prepare the business combination's 2021 consolidation worksheet; ignore income tax effects. b. Determine the amount of income tax for Travers and Yarrow on a consolidated tax return for 2021. c. Determine the amount of Stookey's income tax on a separate tax return for 2021. d. Based on the answers to requirements (b) and (c), what journal entry does this combination make to record 2021 income tax? Complete this question by entering your answers in the tabs below. Req A Reg B and c Req D b. Determine the amount of income tax for Travers and Yarrow on a consolidated tax return for 2021. c. Determine the amount of Stookey's income tax on a separate tax return for 2021. (Round your intermediate and final answer to the nearest whole dollar.) Amounts b. Income tax payable for Travers and Yarrow Income tax payable for Stookey C. Req A Req Band C Req D Based on the answers to requirements (b) and (c), what journal entry does this combination make to record 2021 income tax? (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your intermediate and final answer to the nearest whole dollar.) View transaction list Journal entry worksheet 1 Record the income tax payable. Note: Enter debits before credits. Transaction General Journal Debit Credit 1