On January 1, 20X1, Fern Corporation paid Morton Advertising $121,100 to acquire 70 percent of Vincent Companys stock. Fern also paid $45,000 to acquire $50,000 par value 8 percent, 10-year bonds directly from Vincent on that date. Interest payments are made on January 1 and July 1. The fair value of the noncontrolling interest at January 1, 20X1, was $51,900, and book value of Vincents net assets was $117,000. The book values and fair values of Vincents assets and liabilities were equal except for buildings and equipment, which had a fair value $56,000 greater than book value and a remaining economic life of 14 years at January 1, 20X1.

The trial balances for the two companies as of December 31, 20X3, are as follows: