On January 1, 2023, Gomez Company acquired 90 percent of Martin Company's outstanding stock for $799,560. The 10 percent noncontrolling interest had an assessed fair value of $88,840 on that date. Martin's acquisition-date book value consisted of $319,000 common stock and $453,000 retained earnings. Any acquisition-date excess fair value over book value was attributed to an unrecorded licensing agreement owned by Martin with an estimated remaining life of 12 years. Gomez uses the equity method to account for its investment in Martin. Also on January 1, 2023, Martin acquired an 80 percent interest in Short Company for $360,900. At the acquisition date, the 20 percent noncontrolling interest fair value was $90,225. Short's acquisition-date book value consisted of $206,500 common stock and $186,500 retained earnings. Any excess fair value was attributed to a fully amortized copyright that had a remaining life of '5 years Martin uses the equity method to account for its investment in Short. Reported separate net income foefore inclusion of equity method income) totals for 2023 follow: HartinCoopanyShoreCompany5185,600130,400 The following are the 2024 financlall statements for these three companies (credit balances indicated by parentheses) Short has transferred inventory to Martin since the takeover amounting to $83,000(2023) and $93,000(2024). These transactions include the same markup applicable to Short's outside sales. In each year, Martin 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 compenies. All dividend declarations are paid in the same period. Required: a1. Prepare schedules that show the calculations of the investment in Short 12/31/24 account balances. a2. Prepare schedules that show the calculations of the Investment in Martin 12/31/24 account balances. b. Prepare the business combination's 2024 consolidation worksheet; ignore income tax effects. c. Determine the amount of income tax for Gomez and Martin on a consolidated tax return for 2024. d. Determine the amount of Short's income tax on a separate tax return for 2024. e. Based on the answers to requirements (c) and (d), what journal entry does this combination make to record 2024 income tax? Complete this question by entering your answers in the tabs below. Prepare schedules that show the calculations of the Investment in Short 12/31/24 account balances. Required: a1. Prepare schedules that show the calculations of the Investment in Short 12/31/24 account balances. a2. Prepare schedules that show the calculations of the Investment in Martin 12/31/24 account balances. b. Prepare the business combination's 2024 consolidation worksheet; ignore income tax effects. c. Determine the amount of income tax for Gomez and Martin on a consolidated tax return for 2024. d. Determine the amount of Short's income tax on a separate tax return for 2024 . e. Based on the answers to requirements (c) and (d), what journal entry does this combination make to record 2024 income tax? Complete this question by entering your answers in the tabs below. Prepare schedules that show the calculations of the Investment in Martin 12/31/24 account balances
