The Holtz Corporation acquired 80 percent of the 100,000 outstanding voting shares of Devine, Inc., for $7.25 per share on January 1, 2020. The remaining 20 percent of Devines shares also traded actively at $7.25 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 $78,000 and a fully amortized trademark with an estimated 10-year remaining life had a $65,000 fair value. At the acquisition date, Devine reported common stock of $100,000 and a retained earnings balance of $288,000.

Following are the separate financial statements for the year ending December 31, 2021:

	Holtz Corporation				Devine, Inc.
Sales	$	(698,000	)		$	(356,500	)
Cost of goods sold		256,000				175,000
Operating expenses		285,000				70,500
Dividend income		(16,000	)			0
Net income	$	(173,000	)		$	(111,000	)
Retained earnings, 1/1/21	$	(701,000	)		$	(358,000	)
Net income (above)		(173,000	)			(111,000	)
Dividends declared		60,000				20,000
Retained earnings, 12/31/21	$	(814,000	)		$	(449,000	)
Current assets	$	315,500			$	215,000
Investment in Devine, Inc.		580,000				0
Buildings and equipment (net)		809,000				441,000
Trademarks		127,000				183,000
Total assets	$	1,831,500			$	839,000
Liabilities	$	(697,500	)		$	(290,000	)
Common stock		(320,000	)			(100,000	)
Retained earnings, 12/31/21 (above)		(814,000	)			(449,000	)
Total liabilities and equities	$	(1,831,500	)		$	(839,000	)

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

1. Prepare a worksheet to consolidate these two companies as of December 31, 2021.

2. Prepare a 2021 consolidated income statement for Holtz and Devine.

3. If instead the noncontrolling interest shares of Devine had traded for $5.31 surrounding Holtzs acquisition date, what is the impact on goodwill?