the Pasta Inc. acquisition of $80\%$ of Spinach Corporation on January $1,2024.$ You must complete the consolidation for the December $31,2024.$ financial statements by completing the following steps:

$1.$ Add a tab to the spreadsheet. Label it Analysis. Prepare an Analysis of the Investment and Allocation Schedule in good format.

$2.$ Add a tab to the spreadsheet. Label it Consol Entries. Prepare the consolidation entries in journal entry format, label them according to our convention: S$,$ A$,$ I, D$,$ E$,$ P$.$ Use cell references to the Analysis of Investment and Allocation Schedule and the given information as necessary.

$3.$ Add a tab to the spreadsheet. Label it Worksheet. Create the consolidation worksheet beginning with the given information. Complete the worksheet by cell$-$referencing into it from the Consol Entries Tab, indicating the appropriate consolidation entry reference letter, and creating the remaining necessary columns and formulas.

$4.$ Add a tab to the spreadsheet. Label it Financial Statements. Prepare a classified consolidated balance sheet and consolidated income statement in multi$-$step format. Use cell referencing from the Consolidation worksheet, but be sure to multiply by $-1$ whenever necessary so that only positive numbers show in the financial statements. Spinach outstanding common stock $80\%$

acquired by Pasta

Cash paid by Pasta for $$2,700,000$

Spinach Corporation shares

Spinach's assessed fair value, $1/1/24$ $$3,375,000$

Book value of Spinach Corporation, $1/1/24$ $$2,070,000$

Accounts Payable Owed by Spinach to Pasta on $12/31/24$ $$45,000$

Spinach's accounts values on $1/1/24$

Book Fair

Value Value

Brands $($indefinite life$)$ $$1,080,000$ $$1,149,000$

Machinery & Equipment $870,000990,000$

$(8-$year remaining life$)$

Patent $(14$ years remaining$)396,000816,000$

Pasta and Spinach Separate Trial Balances Pasta Spinach

$12/31/202412/31/2024$

Revenues $$(4,200,000)$ $$(2,475,000)$

Cost of goods sold $2,322,0001,187,250$

Depreciation expense $984,000108,750$

Amortization expense $-84,000$

Equity in income of Spinach $(840,000)-$

Net income $$(1,734,000)$ $$(1,095,000)$

Retained earnings, $1/1/24$ $$(3,825,000)$ $$(1,590,000)$

Net income $(1,734,000)(1,095,000)$

Dividends paid $900,000150,000$

Retained earnings, $12/31/24$ $$(4,659,000)$ $$(2,535,000)$

Cash $$300,000$ $$246,750$

Accounts Receivable $780,000525,000$

Inventories $1,500,000$ $$525,000$

Investment in Spinach $3,420,000-$

Brands $720,0001,080,000$

Machinery & Equipment $($net$)3,090,000761,250$

Patents $-312,000$

Total assets $$9,810,000$ $$3,450,000$

Accounts payable $$(426,000)$ $$(435,000)$

Long$-$term Debt $(1,800,000)$ $$-$

Common stock $(900,000)(360,000)$

Additional paid$-$in capital $(2,025,000)(120,000)$

Retained earnings $(4,659,000)(2,535,000)$

Total liabilities and equity $$(9,810,000)$ $$(3,450,000)$