Stumped on this - I need the answer and also how to calculate the answer so I can understand better. For all figures, Parflex is on the left and Eagle is on the right. Advanced Accounting 12e, Hoyle, Schaefer, Doupnik - Ch 4, Problem 28

On January 1, 2013, Parflex Corporation exchanged $344,000 cash for 90% of Eagle Corporation's outstanding voting stock. Eagle's acquisition date balance sheet follows:

Cash and receivables $ 15,000 Liabilities $ 76,000 Inventory 35,000 Common stock 150,000 Property and equipment (net) 350,000 Retained earnings 174,000 Assets $ 400,000 L & OE $ 400,000

On January 1, 2013, Parflex prepared the following fair-value allocation schedule:

Consideration transferred by Parflex $ 344,000 10% noncontrolling interest fair value 36,000 Fair value of Eagle 380,000 Book value of Eagle 324,000 Excess fair over book value 56,000 to equipment (undervalued, remaining life of 9 years) 18,000 to goodwill (indefinite life) $ 38,000

The companies' financial statements for the year ending December 31, 2015, follow:

Parflex Eagle Sales $ (862,000 ) $ (366,000 ) Cost of goods sold 515,000 209,000 Depreciation expense 191,200 67,000 Equity in Eagles earnings (79,200 ) 0 Separate company net income $ (235,000 ) $ (90,000 ) Retained earnings 1/1 $ (500,000 ) $ (278,000 ) Net income (235,000 ) (90,000 ) Dividends paid 130,000 27,000 Retained earnings 12/31 $ (605,000 ) $ (341,000 ) Cash and receivables $ 135,000 $ 82,000 Inventory 255,000 136,000 Investment in Eagle 488,900 0 Property and equipment (net) 964,000 328,000 Total assets $ 1,842,900 $ 546,000 Liabilities $ (722,900 ) $ (55,000 ) Common stockParflex (515,000 ) 0 Common stockEagle 0 (150,000 ) Retained earnings 12/31 (605,000 ) (341,000 ) Total liabilities and owners equity $ (1,842,900 ) $ (546,000 )

At year-end, there were no intra-entity receivables or payables.

a. Compute the goodwill allocation to the controlling and noncontrolling interest. b. Show how Parflex determined its Investment in Eagle account balance: Initial value Change in Eagles RE Excess fair value amortization Equity income 2015

c.

Determine the amounts that should appear on Parflexs December 31, 2015, consolidated statement of financial position and its 2015 consolidated income statement. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.)

PARFLEX CORPORATION AND EAGLE CORPORATION Consolidation Worksheet For Year Ending December 31, 2015 Adjustments & Elimination Noncontrolling Consolidated December 31, 2015 Parflex Eagle Debit Credit Interest Totals Sales (862,000) (366,000) Cost of goods sold 515,000 209,000 Depreciation expense 191,200 67,000 Equity in Eagle's earnings (79,200) 0

Separate company income (235,000) (90,000) Consolidated net income to noncontrolling interest to parent Retained earnings, 1/1 (500,000) (278,000) Net income (235,000) (90,000) Dividends declared 130,000 27,000 Retained earnings, 12/31 (605,000) (341,000) Cash and receivables 135,000 82,000 Inventory 255,000 136,000 Investment in Eagle 488,900 0 Property & equipment (net) 964,000 328,000 Goodwill Total assets 1,842,900 546,000 Liabilities (722,900) (55,000) Common stock (515,000) (150,000) NCI 1/1 NCI 12/31 Retained earnings, 12/31 (605,000) (341,000) Total liabilities and equities (1,842,900) (546,000) 0 0 Eagle 2015 dividends Investment in Eagle 12/31/15 $0

Thank you