Part a. facts: Gibson acquired interest in Keller 1/1/2014 Various considerations given for acquisition Fair value of noncontrolling interest at acquisition Keller's book value Value assigned to Keller customer list Keller customer list- life for purposes of amortization Book value of land Gibson sold to Keller on 1/2/2014 60% S 570,000 $ 380,000 $ 850,000 $ 100,000 20 $ 60,000 $ 100,000 Price paid by Keller for Gibson's land Cost of inventory shipped by Keller to Gibson in 2014 S 100,000 Price paid by Gibson for 2014 inventory Cost of intra-entity shipments by Keller to Gibson in 2015 $140,000 Price paid by Gibson for 2015 intra-entity shipments Percentage of inventory resold in period following transfer Amount Gibson owes Keller at end of 2015 S 150,000 S 200,000 20% S 40,000 Part b. facts: Building sold to Keller instead of land Book value of building Gibson sold to Keller Price paid by Keller for Gibson building Cost of building Remaining life at date of transfer $ 60,000 $ 100,000 S 140,000 10 Gibson Keller Sales Cost of goods sold Operating expenses Equity in earnings of Keller Company Company Company S (800,000) S (500,000) 800,000 60,000 500,000 100,000 Net income S (284,000) $ (140,000) Retained earnings, 1/1/15 S(1,116,000) S (620,000)