Purity Corporation acquired $90$ percent of Shady Company$$s outstanding common stock on December $31,$

$2020,$ for $$1,152,000.$ At that date, the fair value of the noncontrolling interest was $$128,000,$ and Shady

reported common stock outstanding of $$490,000,$ additional paid$-$in capital of $$290,000,$ and retained earnings

of $$420,000.$ The book values and fair values of Shady assets and liabilities were equal except for land,

which was worth $$30,000$ more than its book value.

On April $1,2021,$ Purity issued at par $$200,000$ of $10$ percent bonds directly to Shady; interest on

the bonds is payable March $31$ and September $30.$ On January $2,2022,$ Purity purchased all of Shady

outstanding $10-$year, $12$ percent bonds from an unrelated institutional investor at $98.$ The bonds originally

had been issued on January $2,2016,$ for $101.$ Interest on the bonds is payable December $31$ and June $30.$

Both companies amortize bond premiums and discounts on a straight$-$line basis.

Since the date it was acquired by Purity $,$ Shady has sold inventory to Purity on a regular basis. The

amount of such interCorporation sales totaled $$64,000$ in $2021$ and $$78,000$ in $2022,$ including a $30$ percent

gross profit. All inventory transferred in $2021$ had been resold by December $31,2021,$ except inventory for which

Purity had paid $$15,000$ and did not resell until January $2022.$

All inventory transferred in $2022$ had been resold at December $31,2022,$ except merchandise for which Purity

had paid $$18,000.$

At December $31,2022,$ trial balances for Purity and Shady appeared as follows:

As of December $31,2022,$ Shady had declared but not yet paid its fourth$-$quarter dividend of $$10,000.$

Both Purity and Shady use straight$-$line depreciation and amortization, including the amortization of

bond discount and premium. On December $31,2022,$ Purity$$management reviewed the amount

attributed to goodwill as a result of its purchase of Shady common stock and concluded that an impairment loss

in the amount of $$25,000$ had occurred during $2022$ and should be shared proportionately between the

controlling and noncontrolling interests. Purity uses the equity method to account for its investment in Shady.

Required:

a$.$ Compute the amount of the goodwill as of January $1,2022.$

b$.$ Compute the gain or loss on the constructive retirement of Shady$$s bonds that should appear in the

$2022$ consolidated income statement.

c$.$ Compute the bond interest expense to be eliminated

d$.$ Compute the bond interest income to be eliminated

e$.$ Calculate the gross profit in $2021$ and $2022$ inventories

f$.$ Prepare and complete a worksheet for the preparation of consolidated financial statements for $2022.$

g$.$ Prepare Purity's consolidated classified balance sheet, multiple$-$step income statement and statement of retained earnings for $2022$