The individual financial statements for Gibson Company and Keller Company for the year ending December 31, 2018, follow. Gibson acquired a 60 percent interest in Keller on January 1, 2017, in exchange for various considerations totaling $450,000. At the acquisition date, the fair value of the noncontrolling interest was $300,000 and Keller's book value was $590,000. Keller had developed internally a customer list that was not recorded on its books but had an acquisition-date fair value of $160,000. This intangible asset is being amortized over 20 years.

Gibson sold Keller land with a book value of $75,000 on January 2, 2017, for $150,000. Keller still holds this land at the end of the current year.

Keller regularly transfers inventory to Gibson. In 2017, it shipped inventory costing $126,000 to Gibson at a price of $210,000. During 2018, intra-entity shipments totaled $260,000, although the original cost to Keller was only $182,000. In each of these years, 20 percent of the merchandise was not resold to outside parties until the period following the transfer. Gibson owes Keller $35,000 at the end of 2018.

Gibson Company Keller Company

Sales $(860,000)$(560,000)

Cost of goods sold560,000360,000

Operating expenses160,00055,000

Equity in earnings of Keller(87,000)0

Net income$(227,000)$(145,000)

Retained earnings, 1/1/18 $(1,176,000)$(650,000)

Net income (above)(227,000)(145,000)

Dividends declared145,00055,000

Retained earnings, 12/31/18 $(1,258,000)$(740,000)

Cash$175,000$70,000

Accounts receivable368,000470,000

Inventory450,000380,000

Investment in Keller828,0000

Land170,000450,000

Buildings and equipment (net)502,000360,000

Total assets$2,493,000$1,730,000

Liabilities$(585,000)$(510,000)

Common stock(650,000)(380,000)

Additional paid-in capital0(100,000)

Retained earnings, 12/31/18(1,258,000)(740,000)

Total liabilities and equities$(2,493,000)$(1,730,000)

(Note: Parentheses indicate a credit balance.)

1. Preparea worksheet to consolidate the separate 2018 financial statements for Gibson and Keller. ((Do not round intermediate calculations. 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.)
2. How would the consolidation entries in requirement (a) have differed if Gibson had sold a building with a $90,000 book value (cost of $200,000) to Keller for $160,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life at the date of transfer. ((Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

2a)Prepare the Entry *TA to defer the intra-entry gain as of the beginning of the year.

2b)Prepare Entry ED to remove the excess depreciation for the current year created by the transfer price