Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2018, for $737,280 cash. At the acquisition date, Sierras total fair value, including the noncontrolling interest, was assessed at $921,600 although Sierras book value was only $680,000. Also, several individual items on Sierras financial records had fair values that differed from their book values as follows:

Using the acquisition method, prepare the worksheet to consolidate these two companies.

Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2018, for $737,280 cash. At the acquisition date, Sierra's total fair value, including the noncontrolling interest, was assessed at $921,600 although Sierra's book value was only $680,000. Also, several individual items on Sierra's financial records had fair values that differed from their book values as follows: Book Value $ 60,100 352,000 147,000 Fair Value Land Buildings and equipment (10-year remaining life) Copyright (20-year remaining life) Notes payable (due in 8 years) 228,100 302,000 253,000 (133,400) (151,000) For internal reporting purposes, Padre, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies Padre (1,635,200) Sierra $ Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra (663 , 80e) 479,000 13, 300 7,35e 8,150 795,000 358,800 49,000 122,808 Net income (556,800) (156, 000) $ (1,392,500) (520 Retained earnings, 1/1/18 Net income Dividends declared ,000) (156,880) (556,800) 260,00 65,96 (1,688,50) (611,000) 570,550 Retained earnings, 12/31/18 Current assets Investment in Sierra Land Buildings and equipment (net) Copyright $ 1,081,420 808,880 385,800 911,008 60,100 338,780 139,650 $ 1,109,000 Total assets $ 3,185,500 Padre Sierra Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra $ (1,635,200) (663,800) 479,000 13,300 7, 350 8,150 795,000 358,000 49,000 122,800 Net income Retained earnings, 1/1/18 Net income Dividends declared $(556,00 (156,000) $(1,392,50 (520,000) (156,000) 65,000 $ (1,688,500) (611,000) $ 1,081,420 570,550 (556,000) 260,800 Retained earnings, 12/31/18 Current assets Investment in Sierra Land Buildings and equipment (net) Copyright 808,080 385,000 911,000 60,100 338,700 139,650 $ 3,185,500 1,109,000 Total assets Accounts payable Notes payable Common stock Additional paid-in capital Retained earnings (above) $(227,00) (187,000) (151,000) (100,000) (60,000) (1,688,500)_(611,000) $ (3,185,50 (1,109,000) (520,000) (300,000) (450,000) Total liabilities and equities At year-end, there were no intra-entity receivables or payables. Using the acquisition method, prepare the worksheet to consolidate these two companies. (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 intone 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.) mounts in the Debit and Credit columns sh uld be entered as positive. Negative amounts for the Noncntrolling Interest and : Cnsolidated Totals columns shuld be entered with a minus sign.) PADRE INC., AND SIERRA CORPORATION Consolidated Worksheet For Year Ending December 31, 2018 Consolidation Entries Noncontrolling Consolidated Accounts Padre Sierra Debit Credit Interest Totals Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra Separate company net income Consolidated net income S (1,635,200) S (663,800) 479,000 13,300 7,350 8,150 795,000 358,000 49,000 (122,800) $ (556,000) S (156,000) NI to noncontrolling interest NI to Padre Company Retained earnings 1/1 Net income (above) Dividends declared $ (1,392,500) S (520,000) (556,000) (156,000) 65,000 260,000 Retained earnings 12/31 Current assets Investment in Sierra Land Ruildinac.and.omwamoat.(nat) $ 1,081,420 S 570,550 808,080 385,000 60,100 238.7a0. Equity in income of Sierra Separate company net income Consolidated net income (122,800) S (556,000) $ (156,000) NI to noncontrolling interest NI to Padre Company Retained earnings 1/1 Net income (above) Dividends declared S (1,392,500) $(520,000) (556,000) 156,000) 65,000 S (1,688,500) $ (611,000) S 1,081,420 570,550 260,000 Retained earnings 12/31 Current assets Investment in Sierra Land Buildings and equipment (net) Copyright 808,080 385,000 911,000 60,100 338,700 139,650 S 3,185,500 $ 1,109,000 S (227,000) $ (187,000) 520,000151,000) Total assets Accounts payable Notes payable NCI in Sierra 1/1 NCI in Sierra 12/31 Common stock Additional paid-in capital Retained earnings 12/31 (above) Total liabilities and stockholders' equity (300,000)100,000) (60,000) (611,000) s (3.185,500)1109,000) (450,000) (1,688,500)