Yarrow since the takeover amounting to $114,000 (2017) and $142,500 (2018). These transactions include the same markup applicable to Stookey's outside sales. In each year, Yarrow carried 20 percent of this inventory into the succeeding year before disposing of it. An effective tax rate of 40 percent is applicable to all companies. All dividend declarations are paid in the same period. Travers Yarrow Stookey Company Company Company Sales $(1,070,000) $ (730,900) $ (534,000) Cost of goods sold 570,100 389,700 320,400 Operating expenses 118,700 97,000 106,800 Net income $ (381,200) $ (244,200) $ (106,800) Retained earnings, 1/1/18 $ (870,000) $ (732,600) $ (453,000) Net income (above) (381,200) (244,200) (106,800) Dividends declared 152,480 0 0 Retained earnings, 12/31/18 $(1,098,720) $ (976,000) $ (559,800) Current assets $ 547,700 $ 463,300 $360,700 Investment in Yarrow Company 873,000 0 0 Investment in Stookey Company 0 480,000 0 Land, buildings, and equipment (net) 1,151,300 870,000 509,800 Total asseto $ 2,572,000 $ 1,813,300 $ 870,500 Liabilities $ (973,280) $ (516, 100) $ (110,700) Common stock (500,000) (320, 400) (200,000) Retained earnings, 12/31/18 (1,098,720) (976, 800) (559,800) Total liabilities and equities $(2,572,000) $(1,813,300) $ (870,500) Note: Parentheses indicate a credit balance. Note: Parentheses indicate a credit balance. a. Prepare the business combination's 2018 consolidation worksheet; ignore income tax effects. b. Determine the amount of income tax for Travers and Yarrow on a consolidated tax return for 2018. c. Determine the amount of Stookey's income tax on a separate tax return for 2018. d. Based on the answers to requirements (b) and (c), what journal entry does this combination make to record 2018 income tax? Complete this question by entering your answers in the tabs below. Req A Req B and C Reg D Noncontrolling Consolidated Accounts TRAVERS COMPANY AND CONSOLIDATED SUBSIDIARIES Consolidation Worksheet For Yoar Ending December 31, 2018 Consolidation Entries Travers Yarrow Stookey Debit Credit Company Company Company (1.070,000) (730,900) (534,000) 570,100 389,700 320,400 118,700 97,000 106,800 (381,200) (244,200) (106,800) Interest Balance 0 0 Sales and other revenue Cost of goods sold Operating expenses Separate company net income Consolidated net income Net income attributable to NCI (Yarrow) Net Income attributable to NCI (Stookey) Net income attributable to Travers Company Retained earnings, 1/1/18 Travers Company Yarrow Company Stookey Company Net income (above) Dividends declared Retainer corinne 12/11/18 (870,000) (732,600) (453,000) (106,800) (244,200) (381200) 152,480 11 MOR 721 n 1976 RON 1 Al (732,600) (453,000) (106,800) (244,200) (381,200) 152,480 (1,098,720) 547,700 873,000 0 (976,800) 463,300 (559,800) 360,700 480,000 870,000 1,151,300 509,800 Yarrow Company Stookey Company Net income (above) Dividends declared Retained earnings, 12/31/18 Current assets Investment in Yarrow Company Investment in Stookey Company Land, buildings, & equipment (net) Copyright Customer list Total assets Liabilities Common stock Retained earnings, 12/31/18 (above) NCI interest in Stookey, 1/1/18 Noncontrolling interest in Yarrow, 1/1/18 Noncontrolling interests in subsidiaries Total liabilities and equities 2,572,000 (973,280) (500,000) (1,098,720) 1,813,300 (516,100) (320,400) (976,800) 870,500 (110,700) (200,000) (559,800) 0 0 (2,572,000) (1,813,300) (870,500)