Pavin acquires all of Stabler's outstanding shares on January 1, 2018, for $690,000 in cash. Of this amount, $53,000 was attributed to equipment with a 5-year remaining life and $63,000 was assigned to trademarks expensed over a 10-year period. Pavin applies the partial equity method so that income is accrued each period based solely on the earnings reported by the subsidiary. On January 1, 2021, Pavin reports $530,000 in bonds outstanding with a carrying amount of $492,800. Stabler purchases half of these bonds on the open market for $255,700. During 2021, Pavin begins to sell merchandise to Stabler. During that year, inventory costing $172,000 was transferred at a price of $215,000. All but $33,000 (at sales price) of these goods were resold to outside parties by year-end. Stabler still owes $56,000 for inventory shipped from Pavin during December. The following financial figures are for the two companies for the year ending December 31, 2021. Dividends were both declared and paid during the current year. Revenues Cost of goods sold Expenses Interest expense-bonds Interest income-bond investment Loss on extinguishment of bonds Equity in Stabler's income Net income Retained earnings, 1/1/21 Net income (above) Dividends declared Retained earnings, 12/31/21 Cash and receivables Inventory Investment in Stabler Investment in Pavin bonds Land, buildings, and equipment (net) Trademarks Total assets Accounts payable Bonds payable Discount on bonds Common stock Retained earnings (above) Pavin (809,000) 478,000 Stabler $ (551,000) 263,000 148,000 181,500 59,000 0 (25,950) (132,450) $ (256,450) (368,000) $ (132,450) $ (407,000) (256,450) $ 178,000 (446,450) 240,000 198,000 698,450 (132,450) 100,000 $ (439,450) $ 58,000 110,000 0 268,000 0 $ 1,404,450 (119,000) (530,000) 23,000 (332,000) (446,450) Total liabilities and stockholders' equity $ (1,404,450) 259,250 564,000 $ 991,250 $ (285,800) (123,000) (143,000) (439,450) $ (991,250) Note: Credits are indicated by parentheses. Prepare a worksheet to produce consolidated balances. (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. Input all amounts as positive values.) PAVIN AND STABLER Consolidation Worksheet For Year Ending December 31, 2021 Consolidation Entries Accounts Pavin Stabler Debit Credit Consolidated Totals Revenues $ 809,000 $ 551,000 $ 215,000 $ 1,145,000 Cost of goods sold 478,000 263,000 8,250x 215,000 534,250 Expenses 148,000 181,500 16,900 246,400 x Interest expense-bonds 59,000 0 29,500 29,500 Interest income-bond investment Loss on extinguishment of bonds Equity in Stabler's income Net income Retained earnings, 1/1/21 (Pavin) Retained earnings, 1/1/21 (Stabler) Net income 0 25,950 25,950 0 0 9,300 9,300 132,450 0 132,450 $ 256,450 $ 132,450 $ 325,550 368,000 50,700 317,300 407,000 407,000 256,450 132,450 225,550 x Dividends declared 178,000 100,000 100,000 178,000 Retained earnings, 12/31/21 $ 446,450 $ 439,450 $ 364,850 Cash and receivables $ 240,000 $ Inventory Investment in Stabler 198,000 58,000 110,000 56,000 $ 242,000 8,250 299,750 x 698,450 0 100,000 798,450 Investment in Pavin bonds 0 259,250 259,250 Land, buildings, and equipment 268,000 564,000 21,200 10,600 842,600 (net) Trademarks Total assets Accounts payable Bonds payable Discount on bonds Common stock Retained earnings 0 0 44,100 6,300 37,800 $ 1,404,450 $ 991,250 $ 1,422,150 119,000 285,800 56,000 348,800 530,000 123,000 265,000 388,000 23,000 0 11,500 (11,500) 332,000 446,450 143,000 439,450 143,000 332,850 364,850 Total liabilities and stockholders' equity $ 1,404,450 $ 991,250 $ 1,494,850 $ 1,494,850 $ 1,446,000