The individual financial statements for Castle King Co (CKC) and Rooke Company (ROC) for the year ending December 31, 2022, are shown on the next page. CKC acquired a 60 percent interest in ROC on January 1, 2021, in exchange for cash payment of $1,140,000. At the acquisition date, the fair value of the noncontrolling interest was $760,000 and ROC book value was $1,700,000. ROC had developed internally a customer list that was not recorded on its books but had an acquisitiondate fair value of $100,000. This intangible asset is being amortized over 20 years. ROCs Equipment was undervalued at January 1, 2021 by $45,000. The equipment had a remaining life of 9 years as of the date of acquisition. ROCs long-term debt had a carrying value of $100,000 but its fair value was only $95,000 at January 1, 2021. The remaining term of the debt of January 1, 2021 was 5 years. ROC regularly transfers inventory to CKC. In 2021, it shipped inventory costing $100,000 to CKC at a price of $150,000. During 2022, ROC shipped inventory costing $140,000 at price of $280,000. Twenty percent of the intercompany sales amounts remained in inventory at the end of each year: $30,000 in 2021 and $56,000 in 2022 at transfer prices. CKC owes ROC $40,000 at the end of 2022. Required: Prepare an Excel spreadsheet workbook containing the following in 5 tabs.

1. Fair Value Allocation Schedule for the Investment by CKC Company in ROC Company on January 1, 2021.

2. Equity method entries to account for CKCs investment in ROC for the year 2022. Use cell referencing from the allocation schedule when appropriate.

3. Consolidation elimination entries for the year 2022. Again cross reference to the allocation schedule when appropriate.

4. Consolidation worksheet for the year 2022. Be sure to cross reference from the consolidation elimination entries into the worksheet.

5. Financial statements for the year ended December 31, 2022 showing a consolidated balance sheet and a consolidated income statement in good form (classified balance sheet and multi-step income statement). Be sure to cross reference from the worksheet into the financial statements.

(Credits in parentheses) Castle king Company $ (1,600,000) Cost of goods sold 990,000 Operating expenses 121,000 Depreciation and Amortization Expenses 70,000 Interest Expense 10,000 Equity Income of Rooke Company (150,600) Net income $ (559,600) Retained earnings, 1/1/22 $ (2,134,000) Net income (559,600) Dividends 230,000 Retained earnings, 12/31/22 $ (2,463,600) Cash $ 375,400 Accounts receivable 674,200 Inventory 880,000 Investment in Rooke Company 1,422,000 Land 300,000 Buildings and equipment (net) 992,000 Total assets $ 4,643,600, Accounts Payable $ (760,000) Long-Term Debt (200,000) Common stock (1,220,000) Additional paid-in capital 0 Retained earnings, 12/31/22 (2,463,600) Total liabilities and stockholders equity $ (4,643,600)

(Credits in parentheses) Rooke Company Sales $ (1,000,000) Cost of goods sold 600,000 Operating expenses 75,000 Depreciation and Amortization Expenses 40,000 Interest Expense 5,000 Equity Income of Rooke Company 0 Net income $ (280,000) Retained earnings, 1/1/22 $ (1,240,000) Net income (280,000) Dividends 120,000 Retained earnings, 12/31/22 $ (1,400,000) Cash $ 180,000 Accounts receivable 820,000 Inventory 640,000 Investment in Rooke Company 0 Land 780,000 Buildings and equipment (net) 600,000 Total assets $ 3,020,000 Accounts Payable $ (700,000) Long-Term Debt (100,000) Common stock (640,000) Additional paid-in capital (180,000) Retained earnings, 12/31/22 (1,400,000) Total liabilities and stockholders equity $ (3,020,000)

Accounts Sales Cost of goods sold Operating expenses Castle King Company (1,600,000) 990,000 121,000 Rooke Company (1,000,000) 600,000 75,000 40,000 5,000 Depreciation and Amortization Expenses Interest expense Equity in income of Rooke Company Separate company net income 70,000 10,000 (177.120) (559,600) GW (280,000) Retained earnings. 1/1/22 Net income Dividends Retained earnings, 12/31/22 (2,134,000) (559,600) 230,000 (2.463,600) (1,240,000) (280,000) 120,000 (1,400,000) 180,000 820,000 640,000 Cash Accounts receivable Inventory Investment in Rooke Company Land Buildings and equipment (net) Total assets 375,400 674,200 880,000 1,422,000 300,000 992,000 4.643,600 780,000 600,000 3,020,000 Accounts payable Long-Term Debt Common stock Additional paid-in capital Retained earnings, 12/31/22 Total liabilities and stockholders' equity (760,000) (200,000) (1,220,000) (700,000) (100,000) (640,000) (180,000) (1.400.000) (3,020,000) (2.463,600) (4,643,600) Accounts Sales Cost of goods sold Operating expenses Castle King Company (1,600,000) 990,000 121,000 Rooke Company (1,000,000) 600,000 75,000 40,000 5,000 Depreciation and Amortization Expenses Interest expense Equity in income of Rooke Company Separate company net income 70,000 10,000 (177.120) (559,600) GW (280,000) Retained earnings. 1/1/22 Net income Dividends Retained earnings, 12/31/22 (2,134,000) (559,600) 230,000 (2.463,600) (1,240,000) (280,000) 120,000 (1,400,000) 180,000 820,000 640,000 Cash Accounts receivable Inventory Investment in Rooke Company Land Buildings and equipment (net) Total assets 375,400 674,200 880,000 1,422,000 300,000 992,000 4.643,600 780,000 600,000 3,020,000 Accounts payable Long-Term Debt Common stock Additional paid-in capital Retained earnings, 12/31/22 Total liabilities and stockholders' equity (760,000) (200,000) (1,220,000) (700,000) (100,000) (640,000) (180,000) (1.400.000) (3,020,000) (2.463,600) (4,643,600)