The Holtz Corporation acquired 80 percent of the 100,000 outstanding voting shares of Devine, Inc., for $6.40 per share on January 1, 2017. The remaining 20 percent of Devines shares also traded actively at $6.40 per share before and after Holtzs acquisition. An appraisal made on that date determined that all book values appropriately reflected the fair values of Devines underlying accounts except that a building with a 5-year future life was undervalued by $62,000 and a fully amortized trademark with an estimated 10-year remaining life had a $67,000 fair value. At the acquisition date, Devine reported common stock of $100,000 and a retained earnings balance of $260,000.

Following are the separate financial statements for the year ending December 31, 2018:

	Holtz Corporation				Devine, Inc.
Sales	$	(787,000	)		$	(392,000	)
Cost of goods sold		282,000				105,000
Operating expenses		346,000				117,000
Dividend income		(16,000	)			0
Net income	$	(175,000	)		$	(170,000	)
Retained earnings, 1/1/18	$	(727,000	)		$	(330,000	)
Net income (above)		(175,000	)			(170,000	)
Dividends declared		50,000				20,000
Retained earnings, 12/31/18	$	(852,000	)		$	(480,000	)
Current assets	$	379,500			$	162,000
Investment in Devine, Inc		512,000				0
Buildings and equipment (net)		785,000				422,000
Trademarks		148,000				206,000
Total assets	$	1,824,500			$	790,000
Liabilities	$	(652,500	)		$	(210,000	)
Common stock		(320,000	)			(100,000	)
Retained earnings, 12/31/18 (above)		(852,000	)			(480,000	)
Total liabilities and equities	$	(1,824,500	)		$	(790,000	)

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

1. Prepare a worksheet to consolidate these two companies as of December 31, 2018.

2. Prepare a 2018 consolidated income statement for Holtz and Devine.

3. If instead the noncontrolling interest shares of Devine had traded for $4.89 surrounding Holtzs acquisition date, what is the impact on goodwill?