Poppy Corporation acquired a 90% interest in Sub Corporation on Jan. 1, 2023 for $540,000, at which time Subs shareholders equity consists of capital stock $300,000 and retained earnings $180,000. The fair value and book value differential is an unrecorded patent with a remaining useful life of 10 years. In 2023, Sub reported net income of $100,000 and paid $20,000 cash dividends. Additional information on intercompany transactions in 2023 are as follows:

1. Sup sold inventory items to Poppy for $120,000 during 2023. Poppys inventories at December 31 2023 included unrealized profits of $20,000.
2. On Jan. 1, 2023, Sub sold equipment with a book value of $50,000 to P for $75,000. The equipment had a remaining useful life of 5 years at the time, and straight-line depreciation is used.
3. During 2023, Sub sold land with a book value of $20,000 to Poppy for $30,000.
4. Poppys accounts receivable on Dec. 31 2023 includes $17,000 due from Sub
5. Poppy uses the equity method for its investment in Sub.

Required:

1. Compute the total excess (1 point)
2. Allocate the excess (1 point)
3. Divide Subs income between Poppy and the noncontrolling shareholders (2 points)
4. Prepare eliminating working paper entries on Dec. 31, 2023 (the seven steps) (6 points).