Parent, Inc., acquires Subsidiary Corporation on January 1, 2020 for $542,800 cash. The subsidiary remains separate incorporation. Immediately after the acquisition, the two companies have the following account balances. Subsidiary's equipment (with a five-year remaining life) is worth $501,300 in the market. Credit balances are indicated by parentheses. Current assets Parent Subsidiary $362,000 $285,000 Investment in Subsidiary 542,800 0 Equipment 705,300 444,000 Liabilities Common stock (243,000) (251,000) (350,000) (150,000) Retained earnings, 1/1/20 (1,017,100) (328,000) In 2020, Subsidiary earns a net income of $59,700 and declares and pays a $5,000 cash dividend. In 2020, Parent reports net income from its own operations (exclusive of any income from Subsidiary) of $144,000 and declares no dividends. At the end of 2021, selected account balances for the two companies are as follows: Revenues Expenses Equity investment income Retained earnings, 1/1/21 Dividends declared Common stock Current assets Investment in Subsidiary Equipment Liabilities Parent Subsidiary $(404,000)$(252,000) 292,900 189,000 Not given 0 Not given (382,700) 0 8,000 (350,000) (150,000) 648,000 343,500 Not given 0 598,800 480,600 (179,100) (204,500) a. What are the December 31, 2021, Equity investment income and Investment in Subsidiary account balances assuming Parent uses the: Equity method. Initial value method. Hint: (1) using equity method and initial value method (i.e., cost method) to account for investment will lead to different ways to recognize income associated with the equity investment. (2) To derive the ending balance of both accounts, you will need to find out the allocation table first. Allocate the excess payment over the book value to individual assets or liabilities that has a fair value excess, and find out AMORT. b. What is the amount of Consolidated Equipment in its December 31, 2021, consolidated balance sheet under each of the following methods? c. Prepare the worksheet adjusting entry needed to account for the differences in ending balances due to parent's application of intital cost method rather than the equity method. Hint: This is the [C] entry. d. Prepare the worksheet entry to eliminate Subsidiary's stockholders' equity. Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Req A Req B Req C and D A.What are the December 31, 2021, Equity Investment Income and Investment in Subsidiary account balances assuming Parent uses the: Equity method Equity Investment Investment in Income Subsidiary Initial value method < Req A Req B > Complete this question by entering your answers in the tabs below. Req A Req B Req C and D B. What is the amount of Consolidated Equipment in its December 31, 2021, consolidated balance sheet under each of the following methods? Equity method Initial value method Consolidated Equipment < Req A Req C and D > Complete this question by entering your answers in the tabs below. Req A Req B Req C and D C. Worksheet adjustment entry to convert the initial value method to equity method; D. Prepare the worksheet entry to eliminate Subsidiary's stockholders' equity. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list Consolidation Worksheet Entries < 1 2 *C entry Note: Enter debits before credits. Date January 01, 2021 Accounts Debit Credit Record entry Clear entry view consolidation entries > Show less Drov of 4 Next