The Holtz Corporation acquired 80 percent of the 100,000 outstanding voting shares of Devine, Inc., for $7.95 per share on January 1, 2017. The remaining 20 percent of Devines shares also traded actively at $7.95 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 $53,500 and a fully amortized trademark with an estimated 10-year remaining life had a $68,000 fair value. At the acquisition date, Devine reported common stock of $100,000 and a retained earnings balance of $385,500.

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

	Holtz Corporation				Devine, Inc.
Sales	$	(675,000	)		$	(347,500	)
Cost of goods sold		209,000				115,000
Operating expenses		293,000				106,500
Dividend income		(16,000	)			0
Net income	$	(189,000	)		$	(126,000	)
Retained earnings, 1/1/18	$	(719,000	)		$	(455,500	)
Net income (above)		(189,000	)			(126,000	)
Dividends declared		70,000				20,000
Retained earnings, 12/31/18	$	(838,000	)		$	(561,500	)
Current assets	$	165,500			$	295,500
Investment in Devine, Inc		636,000				0
Buildings and equipment (net)		782,500				414,000
Trademarks		104,000				190,000
Total assets	$	1,688,000			$	899,500
Liabilities	$	(530,000	)		$	(238,000	)
Common stock		(320,000	)			(100,000	)
Retained earnings, 12/31/18 (above)		(838,000	)			(561,500	)
Total liabilities and equities	$	(1,688,000	)		$	(899,500	)

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

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

Prepare a 2018 consolidated income statement for Holtz and Devine.

If instead the noncontrolling interest shares of Devine had traded for $6.07 surrounding Holtzs acquisition date, what is the impact on goodwill?

1.)

2.)

3.)

Prepare a worksheet to consolidate these two companies as of December 31, 2018. (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. Amounts in the Debit and Credit columns should be entered as positive. Negative amounts for the Noncontrolling Interest and Consolidated Totals columns should be entered with a minus sign.) Show less LTZ CORPORATION AND DEVINE, I Consolldation Worksheet For Year Ending December 31, 2018 Holtz Consolldation Entries Noncontrolling Consolldated Corporation Devine Ino. (675,000(347,500 115,000 106,500 Accounts Debit Credit Interest Totals Sales Cost of goods sold Operating expenses Dvidend income Separate company net income Consolidated ne income 209,000 293,000 16,000 (189,000)$(126,000 NI attributable to noncontralling interest NI attributable to Holtz Corp Retained earnings, 1/1 Net income Dvidends declared (719,000)$(455,500 (189,000) (126,000) 20,000 $ (838,000)(681,500) 70,000 Retained earnings, 12/31 Current assets Investment in Devine Buildings and equipment (net) $ 186,500 295,500 836,000 782,500 414,000 104,000 190,000 Goodwil Tatal assets $ 1,688,000 899,500 Liabilities Common stock Retained earnings, 12/31 NCI in Devine, 1/1 NCI in Devine, 12/31 (530,000)$(238,000 (320,000) (100,000) (838,000) (561,500) Tatal liabilities and equities $(1,688,000$(899,500S