Using the acquisition method, prepare the worksheet to consolidate these two companies.

Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2018, for $765,440 cash. At the acquisition date, Sierra's total fair value, including the noncontrolling interest, was assessed at $956,800 although Sierra's book value was only $694,000. Also, several individual items on Sierra's financial records had fair values that differed from their book values as follows Land Buildings and equipment (10-year remaining life) Copyright (20-year remaining life) Notes payable (due in 8 years) Book ValueFair Value $ 63,20e $ 241,200 331,000 261,000 365,000 159,000 (208,000) (191,200) For internal reporting purposes, Padre, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies. Padre Sierra Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra $ (1,498,640) 759,000 339,000e (686,150) 445,000 12,400 7,950 9,800 47,400 165,760 $ (519,000) (211,000) $ (1,332,500) (534,000) 65,000 Net income Retained earnings, 1/1/18 Net income Dividends declared (519,000) 260,000 (211,000) $ (1,591,500) (680,000) $913,300 $630,150 Retained earnings, 12/31/18 Current assets Investment in Sierra Land Buildings and equipment (net) Copyright 879,206e 63,200 352,600 151,050 $1,197,000 365,000 948,000 Total assets $ 3,105,500 Accounts payable Notes payable Common stock Additional paid-in capital Retained earnings (above) (149,000) (208,000) $ (270,000) (494,000) (300,000) (450,000) (100,000) (60,000) (1,591,500_688,969) $ (3,105,500) $(1,197,000) Total liabilities and equities At year-end, there were no intra-entity receivables or payables