On January 1^st. 2022,X Company purchased 75% of the outstanding common shares and 50% of the outstanding preferred shares of Y Ltd.

On January 1^st. 2022 the balance sheet and fair values of Ys assets and liabilities were as follows:

Y COMPANY

Balance Sheet

As at January 1^st. 2022

Book Values..Fair Values

Cash..$130,000.................$130,000

Accounts receivable 120,000 ...............110,000

Inventory.. 320,000................. 290,000

Capital assets(net).. 670,000

TOTAL ASSETS..$1,240,000

Current liabilities.$ 190,000..190,000

Long-term debt 300,000..300,000

Common shares..300,000

Preferred shares. 200,000**

Retained Earnings250,000

TOTAL OWNERSEQUITY..$1,240,000

**Par value of a preferred share was $100/share.

X Company paid $450,000 for the common shares The preferred shares paid cumulative dividends of 5% of their stated value but dividends for 2020 and 2021 were unpaid. The shares were redeemable, at the option of the issuer, at a premium of $8.00/share.

At January 1^st. 2022, the capital assets of Y had a remaining useful life of ten years. Any unallocated acquisition differential would be treated as goodwill, which is assessed annually for impairment.

X accounts for its investment using the cost method and accounts for the non-controlling interest in its consolidated financial statements using the fair value enterprise method.

Required:-

(a) Prepare a schedule to split Ys shareholders equity section at January 1^st.2022(6 marks)

(b) Calculate the consolidated goodwill at January 1^st.2022(3 marks)

What is the consolidated retained earnings at January 1^st.. 2022(1 marks).

(d) Calculate the non-controlling interest at January 1^st. 2022(2 marks).