On January 1, 2022, the Redder Company exchanged $1,500,000 cash for 100% of the outstanding voting stock of the Lohman Company. On the acquisition date, Lohman Company had net equity consisting of the following: Common Stock Retained Earnings $600,000 750,000 Redder then prepared the following fair value allocations: Equipment, with a remaining life of 10 years was undervalued by $100,000. All other assets and liabilities are fairly reported. During 2022, Lohman Company reported earnings of $160,000 and paid cash dividends totaling $80,000. During 2023, Lohman earned $120,000 and paid dividends in the amount of $50,000. The financial statements for the two companies as of December 31, 2023 is presented on the worksheet, below. Required: complete the worksheet to consolidate the financial information of these two companies as of December 31, 2023 for 10 extra percentage points on Test 1. Redder Company AND CONSOLIDATED SUBSIDIARY Consolidation Worksheet For Year Ending December 31, 2023 Consolidation Entries Income Statement Smith Jones Debit Credit Balances Revenues (6,900,000) (720,000) Cost of goods sold 3,700,000 500,000 Depreciation expense 900,000 200,000 Amortization expense 400,000 100,000 Interest expense 60,000 40,000 Equity earnings in Lohman (110,000) Net income (1,950,000) (120,000) Statement of Retained Earnings Retained earnings 1/1 Net income (above) (5,000,000) (1,950,000) (830,000) (120,000) Dividends declared 550,000 50,000 Retained earnings 12/31 (6,400,000) (900,000) Balance Sheet Cash 70,000 140,000 Accounts receivable 950,000 200,000 Inventories 1,700,000 780,000 Investment in Lohman 1,630,000 Equipment (net) 4,060,000 1,730,000 Patents 90,000 Unpatented technology 2,000,000 450,000 Goodwill 400,000 Total assets 10,900,000 3,300,000 Current liabilities (500,000) (900,000) Long-term debt Common stock Retained earnings 12/31 Total liabilities and equity (1,000,000) (900,000) (3,000,000) (600,000) (6,400,000) (900,000) (10,900,000) (3,300,000)