Refer to the information below and Worksheet 3-1. On January 1, 2016, Parent Company purchased 80% of the common stock of Subsidiary Company for $316,000. On this date, Subsidiary had common stock, other paid-in capital, and retained earnings of $40,000, $120,000, and $190,000, respectively. Net income and dividends for 2 years for Subsidiary Company were as follows: 2016 2017 Net income $50,000 $90,000 Dividends 10,000 20,000 On January 1, 2016, the only tangible assets of Subsidiary that were undervalued were inventory and building. Inventory, for which FIFO is used, was worth $5,000 more than cost. The inventory was sold in 2016. Building, which was worth $15,000 more than book value, has a remaining life of 8 years, and straight-line depreciation is used. Any remaining excess is goodwill. Required: a. Complete the consolidating worksheet for December 31, 2017.

B C D E F G . I J L M N o P Q R S T Eliminations and Adjustment Credit Consolidated Incom Stmt Controling Retained Earnings Consolidated Balance Sheet Debit NCI 1 2 Worksheet 3 4 Inventor, December 31 5 Other Current Assets 6 Investment in Sub 7 12/31/17 Parant Co 60,000 118,000 404,000 Trial Balance Sub Co 40,000 180,000 8 60,000 350,000 -120,000 80,000 300,000 -50,000 -150,000 -40,000 -50,000 -100,000 -100,000 -200,000 -200,000 9 10 11 Land 12 Build & Equipment 13 Accum Deprication 14 Goodwill 15 16 Current Liabilities 17 Bonds Payable 18 Other Long Term Liab 19 20 Common Stock--P Co 21 Other Paid-in Capital P 22 Retained Earnings- 23 24 25 Common Stock S 26 Other Paid in Capital S 27 Retained Earnings-S 28 29 Net Sales 30 Costof Goods Sold 31 Operating Expenses 32 33 Subsidiary Income 34 Dividends Declared-P 35 Dividends Declared-S 36 37 Consolidated Net Income 38 NCI 39 Controling Interest 40 Total NCI 41 Ret Earn Contr Int 12-31 42 40,000 -120,000 -230,000 -550,000 320,000 130,000 -400,000 210,000 100,000 -72,000 50,000 20,000