please answer both for thumbs up, they are already done, need to be complete or corrected!
Padre holds 100 percent of the outstanding shares of Sonora. On January 1, 2016, Padre transferred equipment to Sonora for $118,000. The equipment had cost $150,000 originally but had a $60,000 book value and five-year remaining life at the date of transfer. Depreciation expense is computed according to the straight-line method with no salvage value. Consolidated financial statements for 2018 currently are being prepared. What worksheet entries are needed in connection with the consolidation of this asset? Assume that the parent applies the partial equity method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Answer is not complete. No Transaction Accounts Debit Credit 1 1 Retained earnings Equipment Accumulated depreciation . 32,000 12,000 2 2 11,600 Accumulated depreciation Depreciation expense 11,600 On January 1, 2017, Mcllroy, Inc., acquired a 60 percent interest in the common stock of Stinson, Inc., for $384,600. Stinson's book value on that date consisted of common stock of $100,000 and retained earnings of $227,300. Also, the acquisition-date fair value of the 40 percent noncontrolling interest was $256,400. The subsidiary held patents (with a 10-year remaining life) that were undervalued within the company's accounting records by $77,800 and an unrecorded customer list (15-year remaining life) assessed at a $53,700 fair value. Any remaining excess acquisition-date fair value was assigned to goodwill. Since acquisition, Mcllroy has applied the equity method to its Investment in Stinson account and no goodwill impairment has occurred. At year end, there are no intra-entity payables or receivables. Intra-entity inventory sales between the two companies have been made as follows: Transfer Price Ending Balance Year Cost to Mellroy to Stinson (at transfer price) 2017 $126,900 $158,625 $52,875 2018 113,100 150,000 37,700 The individual financial statements for these two companies as of December 31, 2018, and the year then ended follow: Sales Cost of goods sold Operating expenses Equity in earnings in Stinson Net income Retained earnings, 1/1/18 Net income McIlroy, Inc. $ (730,000) 479,800 196,510 (34,054) (87,744) (771,200) (87,744) Stinson, Inc. $ (366,000) 223,600 76,200 0 $ (66,200) $ (282,600) (66,200) $ $ Sales Cost of goods sold Operating expenses Equity in earnings in Stinson Net income Retained earnings, 1/1/18 Net income Dividends declared Retained earnings, 12/31/18 Cash and receivables Inventory Investment in Stinson Buildings (net) Equipment (net) Patents (net) Total assets Liabilities Common stock Retained earnings, 12/31/18 Total liabilities and equities McIlroy, Inc. $ (730,000) 479,800 196,510 (34,054) (87,744) $ (771,200) (87,744) 47.700 $ (811,244) $ 276,200 259,400 423,463 337,000 240,600 0 $ 1,536,663 $ (425,419) (300,000) (811,244) $(1,536,663) Stinson, Inc. $ (366,000) 223,600 76,200 0 $ (66,200) $ (282,600) (66,200) 18,300 $ (330,500) $ 150,500 131,200 0 205,000 88,800 23,200 $ 598,700 $ (168,200) (100,000) (330,500) $ (598,700) a. Show how Mcllroy determined the $423,463 Investment in Stinson account balance. Assume that Mcllroy defers 100 percent of downstream intra-entity profits against its share of Stinson's income. b. Prepare a consolidated worksheet to determine appropriate balances for external financial reporting as of December 31, 2018. Required A Required B Show how McIlroy determined the $423,463 Investment in Stinson account balance. Assume that - of downstream intra-entity profits against its share of Stinson's income. Consideration transferred Increase in Stinson's retained earnings 1/1/17 to 1/1/18 Excess fair value amortization 2017 ending inventory profit deferral Mcllroy's equity in earnings of Stinson for 2018 Stinson 2018 dividends declared to Mcllroy Investment account balance 12/31/18 $ 384,600 $ 55,300 273,691 10,575 X 339,566 34,054 10,980 $ 769,200
