Paxton purchased an 80% interest in the Saxton Company on January 1, 20X4 for $692,000. On that date, Saxton had the following balance sheet:
Assets	Liabilities and Equity
Current assets	$190,000	Current liabilities	$100,000
Land	100,000
Building	300,000
Accum. Depreciation	-60,000	Common stock (par)	100,000
Equipment	300,000	Paid-in-capital in excess of par	200,000
Accum. Depreciation	-30,000	Retained earnings	400,000
Total assets	$800,000	Total liabilities and equity	$800,000
Fair values that differ from book values on the purchase date are:
Buildings	$400,000, 20 year remaining life
Equipment	$250,000, 10 year remaining life
Any remaining excess is attributed to goodwill
Instructions
The following worksheet is being prepared as of December 31, 20X6. That is 3 years after the purchase. 1. Prepare a price analysis and a determination and distribution of excess schedule and income distribution schedules 2. Complete the following worksheet. Be sure to number your entries and provide a brief description in the spaces provided below the income distribution schedules
Worksheet for Paxton Company
	Trial Balance	Eliminations and Adjustments	NCI	Consolidated
	Paxton	Saxton	Dr.	Cr.
Sales	-250,000	-200,000
Cost of goods sold	150,000	120,000
Expenses	50,000	40,000
Divided income	-8,000
Net income	-58,000	-40,000
NCI
Controlling interest
Retained earnings Jan 1, Paxton	-670,000
Retained earnings Jan 1, Saxton		-500,000
Dividends declared		10,000
Net income (from above)	-58,000	-40,000
Retained earnings Dec 31	-728,000	-530,000
Current assets	246,000	230,000
Investment saxton	962,000
Land	100,000	100,000
Building	300,000	400,000
Accumulated depr (building)	-100,000	-90,000
Equipment	150,000	300,000
Accumulated depr (equipment)	-60,000	-90,000
Goodwill
Current liabilities	-300,000	-20,000
Common stock, par - Paxton	-300,000
Common stock, par - Saxton		-100,000
Paid in capital in excess Saxton		-200,000
Retained earnings Dec, 31 Paxton (from above)	-728,000
Retained earnings Dec, 31 Saxton (from above)		-530,000
Total NCI
Total	0	0
Subsidiary Saxton Company Income Distribution
	Internally generated net income
	Adjusted income
	NCI share
	NCI share
Parent PaxtonCompany Income Distribution
Building depreciation	Internally generated net income
	Equipment depreciation
	80% xSaxton adjusted net income of $______________
	Controlling interest	__________________