On July 1, 2018, Truman Company acquired a 70 percent interest in Atlanta Company in exchange for consideration of $829,500 in cash and equity securities. The remaining 30 percent of Atlantas shares traded closely near an average price that totaled $355,500 both before and after Trumans acquisition.

In reviewing its acquisition, Truman assigned a $127,500 fair value to a patent recently developed by Atlanta, even though it was not recorded within the financial records of the subsidiary. This patent is anticipated to have a remaining life of five years.

The following financial information is available for these two companies for 2018. In addition, the subsidiarys income was earned uniformly throughout the year. The subsidiary declared dividends quarterly.

	Truman				Atlanta
Revenues	$	(739,075	)		$	(479,000	)
Operating expenses		403,000				308,000
Income of subsidiary		(50,925	)			0
Net income	$	(387,000	)		$	(171,000	)
Retained earnings, 1/1/18	$	(915,000	)		$	(589,000	)
Net income (above)		(387,000	)			(171,000	)
Dividends declared		150,000				60,000
Retained earnings, 12/31/18	$	(1,152,000	)		$	(700,000	)
Current assets	$	514,575			$	402,000
Investment in Atlanta		859,425				0
Land		444,000				225,000
Buildings		715,000				713,000
Total assets	$	2,533,000			$	1,340,000
Liabilities	$	(881,000	)		$	(320,000	)
Common stock		(95,000	)			(300,000	)
Additional paid-in capital		(405,000	)			(20,000	)
Retained earnings, 12/31/18		(1,152,000	)			(700,000	)
Total liabilities and stockholders' equity	$	(2,533,000	)		$	(1,340,000	)

How did Truman allocate Atlantas acquisition-date fair value to the various assets acquired and liabilities assumed in the combination?

Consideration transferred by Truman
Noncontrolling interest fair value
Atlantas acquisition-date total fair value	$0
Book value of Atlanta
Fair value in excess of book value	$0
Excess fair value assigned:
Patent
Goodwill	$0

How did Truman allocate the goodwill from the acquisition across the controlling and noncontrolling interests?

	Controlling Interest	Noncontrolling Interest
Goodwill

How did Truman derive the Investment in Atlanta account balance at the end of 2018?

Initial value at acquisition date
Trumans share of Atlantas net income for half year
Dividends 2018
Investment account balance 12/31/18	$0

Prepare a worksheet to consolidate the financial statements of these two companies as of December 31, 2018. At year-end, there were no intra-entity receivables or payables. (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. Amounts in the Debit and Credit columns should be entered as positive. Negative amounts for the Noncontrolling Interest and Consolidated Totals columns should be entered with a minus sign.)

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TRUMAN COMPANY AND SUBSIDIARY ATLANTA COMPANY
Consolidation Worksheet
For Year Ending December 31, 2018
	Truman	Atlanta	Consolidation Entries		Noncontrolling	Consolidated
	Company	Company	Debit	Credit	Interest	Totals
Revenues	$(739,075)	$(479,000)
Operating expenses	403,000	308,000
Net income of subsidiary	(50,925)
Separate company net income	$(387,000)	$(171,000)
Consolidated net income						$0
Net income attributable to NCI
Net income attributable to Truman						$0
Retained earnings, 1/1	$(915,000)	$(589,000)
Net income	(387,000)	(171,000)
Dividends declared	150,000	60,000
Retained earnings 12/31	$(1,152,000)	$(700,000)				$0
Current assets	$514,575	$402,000
Investment in Atlanta	859,425
Land	444,000	225,000
Buildings	715,000	713,000
Patent
Goodwill
Total assets	$2,533,000	$1,340,000				$0
Liabilities	$(881,000)	$(320,000)
Common stock	(95,000)	(300,000)
Additional paid in capital	(405,000)	(20,000)
Retained earnings 12/31	(1,152,000)	(700,000)
Noncontrolling interest 7/1
Noncontrolling interest 12/31					0
Total liabilities and equity	$(2,533,000)	$(1,340,000)	$0	$0		$0