Powell Corporation acquired 90% of the voting stock of Santer Corporation on January 1, 2014 for $11,700 when Santer had Capital Stock of $5,000 and Retained Earnings of $4,000. The amounts reported on the financial statements approximated fair value, with the exception of inventories, which were understated on the books by $500 and were sold in 2014, land which was undervalued by $1,000, and equipment with a remaining useful life of 5 years under the straight-line method which was undervalued by $1,500. Any remainder was assigned to goodwill.

Financial statements for Powell and Santer Corporations at the end of the fiscal year ended December 31, 2015 appear in the first two columns of the partially completed consolidation working papers. Powell has accounted for its investment in Santer using the equity method of accounting. Powell Corporation owed Santer Corporation $100 on open account at the end of the year. Dividends receivable in the amount of $450 payable from Santer to Powell is included in Powell's net receivables.

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c c] . I Normal Subtitle Title B Styles Paragraph Required: COOTER DE CCT Caram und Powe 20 ON $6,500 1,080 IT00037300 ONE DRONE Salon ten com Samme DOSE E SALS Depreciation pense Other spennen Noncontrolling fentent Shase Netinden Retained Zannings 1/1 1.000) 1.000) 1. 800) 100 41-280 $1,500 $ 2, 510 $ 5,000 Net income 1500 2,0001 1,000) vidends etmined Lamnings 12/31 BARCE SHEET s 4,790 $ 5,500 S S 1900 Receivables et Inventories 1. 100 200 1000 1 600 7,500 6,700 12, 060 ti 24600 12,000 Poupant and Buildings.net Investment in er 095 Good 5 B. EGOTT hccounts payable S PAVE Payable CALDT SEE gec- Earning 91.000 500 5500 Il Gress 16 Intatge B. POUITY 24, 600 512 000