Session 4- Consolidating with Intercompany Transactions Palant Corporation acquired 80% of Strong Company's common stock for $45,500 on January 1, 2020. The book value of Strong was $10,000, and the fair value of Non-controlling interest was $9,500. Strong's assets and liabilities were reported at fair value at the date of acquisition except for the items listed below: Goodwill was impaired by $2,000 in 2020 but no further impairment occurred in 2021 . The land, buildings, and identifiable intangibles are still held by Strong at the end of 2021. It is now December 31, 2021. The trial balances of Palant and Strong are provided in the Excel file. Information on intercompany transactions is as follows: 1. On January 2, 2020, Palant sold equipment to Strong for a price of $800. The equipment had an original cost of $1,000 with $700 of accumulated depreciation at the time of sale and a remaining life of 5 years, straight-line. 2. Strong sells merchandise to Palant (for cash) on a continuing basis, at a markup of 20% on cost. Palant's 2021 beginning inventory contains $90 in goods purchased from Strong (including markup). Palant's 2021 ending inventory contains $120 in goods purchased from Strong (including markup). Total intercompany sales for 2021 were $3,000. required a. Create Book Value, Fair Value, Change schedule to determine total goodwill arising from this acquisition and its allocation as well as the BOY and EOY balances for Land, Buildings, Limited Life Intangibles, and Goodwill.| b. Prepare a Schedule of Equity in Strong's net income, OCI, and dividends for 2021 . c. Prepare a consolidating working paper to consolidate the December 31, 2021 trial balances of Palant and Strong. \begin{tabular}{|l|r|r|r|} \hline & & \\ \hline & \multicolumn{2}{|c|}{} & \\ \hline & \multicolumn{2}{|c|}{ December 31,2021} \\ \hline & \multicolumn{2}{|c|}{ Trial Balances } \\ \hline Current assets & Palant & \multicolumn{1}{|c|}{ Strong } \\ \hline Land & 4,800 & 6,000 & \\ \hline Buildings \& Equipment, Cost & 8,000 & 5,000 & \\ \hline Accumulated Depreciation & 160,000 & 30,000 & \\ \hline Intangibles & (14,800) & (4,900) & \\ \hline Investment in Slicker & - & - & \\ \hline Goodwill & 44,824 & - & \\ \hline Current liabilities & (9,000) & (4,500) & \\ \hline Long-term debt & (158,048) & (15,900) & \\ \hline Capital Stock & (18,400) & (3,000) & \\ \hline Retained Earnings & (2,000) & (1,000) & \\ \hline AOCl - January 1 & - & - & \\ \hline Non-controlling interest in Slicker & 800 & 400 & \\ \hline Dividends & (155,000) & (40,000) & \\ \hline Revenues & (896) & - & \\ \hline Equity in NI of Slicker & (80) & - & \\ \hline Equity in OCl of Slicker & 118,000 & 28,000 & \\ \hline Cost of Goods Sold & 32,000 & 9,000 & \\ \hline Operating Expenses & (200) & (100) & \\ \hline OCl & & & \\ \hline NCl - equity in NI of Slicker & & \\ \hline NCl - equity in OCl of Slicker & & \\ \hline Total & & & \\ \hline \end{tabular}