The Holtz Corporation acquired 80 percent of the 100,000 outstanding voting shares of Devine, Inc., for $6.00 per share on January 1, 2020. The remaining 20 percent of Devines shares also traded actively at $6.00 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 $70,500 and a fully amortized trademark with an estimated 10-year remaining life had a $62,000 fair value. At the acquisition date, Devine reported common stock of $100,000 and a retained earnings balance of $158,500.

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

Holtz Corporation Devine, Inc.Sales$(731,000) $(316,000)Cost of goods sold 276,000 149,000 Operating expenses 261,000 83,000 Dividend income (16,000) 0 Net income$(210,000) $(84,000)Retained earnings, 1/1/21$(748,000) $(228,500)Net income (above) (210,000) (84,000)Dividends declared 60,000 20,000 Retained earnings, 12/31/21$(898,000) $(292,500)Current assets$372,500 $170,500 Investment in Devine, Inc. 480,000 0 Buildings and equipment (net) 720,000 324,000 Trademarks 193,000 153,000 Total assets$1,765,500 $647,500 Liabilities$(547,500) $(255,000)Common stock (320,000) (100,000)Retained earnings, 12/31/21 (above) (898,000) (292,500)Total liabilities and equities$(1,765,500) $(647,500)

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 $3.91 surrounding Holtzs acquisition date, what is the impact on goodwill?