Using the above information prepare all required consolidation entries

May purchased 70% of the outstanding common stock of Gardens on 1/1/18 for $17.5 million in cash. Gardens reported the following income and dividends for 2018 and 2019 (in 000's): Net Income Dividends 2018 1,000 300 2019 4,000 1,500 The following are the fair value/book value amounts for Gardens on 1/1/18 (in 000's) as prepared by May: Book Value Fair Values Cash Receivables Inventory (FIFO) Plant & Equipment Less: Accumulated Deprn. Patent FV of workforce in place 600 1,500 1,200 10,000 3,000 600 1,500 1,400 13,000 5,000 2,000 Accounts Payable Bond Payable 859.018 1,111.982 859.018 1.240.158 Common stock Retained Earnings 5400 2929 The $1,000 face bond pays interest semi-annually on 6/30 and 12/31 and had 10 years until maturity on 1/1/18. The bond was originally issued when the market rate was 4% with a coupon rate of 5% The plant & equipment had remaining useful lives of 10 years at 1/1/18 and the patent has a 10 year useful life at 1/1/18. It is estimated that the current workforce in place has remaining service life of 10 years. a. Prepare the required consolidation entries for this subsidiary for 2019. All numbers on the worksheet are in 000's. I recommend that you use a rollforward table for your analysis. These should be neatly written on pages separately from the worksheet. Show all of your work in an organized, clear manner. Balance Sheet May Gardens Cash Accounts Receivable Inventory 6,000 14,000 7,000 700 1,600 2,700 55,000 9,389 Building & Equip-net Investment in S Total Assets Current Liabilities Long-term Note Pay. Bonds Payable 6,000 20,000 2,000 1,759.395 0 1,100.605 5,400 Common stock Additional Paid-in Cap. Retained Earnings 10,000 30,147 0 Income Statement May Gardens 110,000 60,000 Sales Cost of Goods Sold 60,000 30,000 Other Expenses 40,000 26,000 Investment Income from S Net Income May Gardens Statement of RJE 1/1 R/E - Dividends 5,000 1,500 May purchased 70% of the outstanding common stock of Gardens on 1/1/18 for $17.5 million in cash. Gardens reported the following income and dividends for 2018 and 2019 (in 000's): Net Income Dividends 2018 1,000 300 2019 4,000 1,500 The following are the fair value/book value amounts for Gardens on 1/1/18 (in 000's) as prepared by May: Book Value Fair Values Cash Receivables Inventory (FIFO) Plant & Equipment Less: Accumulated Deprn. Patent FV of workforce in place 600 1,500 1,200 10,000 3,000 600 1,500 1,400 13,000 5,000 2,000 Accounts Payable Bond Payable 859.018 1,111.982 859.018 1.240.158 Common stock Retained Earnings 5400 2929 The $1,000 face bond pays interest semi-annually on 6/30 and 12/31 and had 10 years until maturity on 1/1/18. The bond was originally issued when the market rate was 4% with a coupon rate of 5% The plant & equipment had remaining useful lives of 10 years at 1/1/18 and the patent has a 10 year useful life at 1/1/18. It is estimated that the current workforce in place has remaining service life of 10 years. a. Prepare the required consolidation entries for this subsidiary for 2019. All numbers on the worksheet are in 000's. I recommend that you use a rollforward table for your analysis. These should be neatly written on pages separately from the worksheet. Show all of your work in an organized, clear manner. Balance Sheet May Gardens Cash Accounts Receivable Inventory 6,000 14,000 7,000 700 1,600 2,700 55,000 9,389 Building & Equip-net Investment in S Total Assets Current Liabilities Long-term Note Pay. Bonds Payable 6,000 20,000 2,000 1,759.395 0 1,100.605 5,400 Common stock Additional Paid-in Cap. Retained Earnings 10,000 30,147 0 Income Statement May Gardens 110,000 60,000 Sales Cost of Goods Sold 60,000 30,000 Other Expenses 40,000 26,000 Investment Income from S Net Income May Gardens Statement of RJE 1/1 R/E - Dividends 5,000 1,500