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Herbert, Inc., acquired all of Rambis Company$$s outstanding stock on January $1,2020,$ for $$595,000$ in cash. Annual excess amortization of $$16,000$ results from this transaction. On the date of the takeover, Herbert reported retained earnings of $$402,000,$ and Rambis reported a $$229,000$ balance. Herbert reported internal net income of $$51,000$ in $2020$ and $$64,500$ in $2021$ and declared $$10,000$ in dividends each year. Rambis reported net income of $$24,500$ in $2020$ and $$38,000$ in $2021$ and declared $$5,000$ in dividends each year.

a$.$ Assume that Herbert$$s internal net income figures above do not include any income from the subsidiary.

If the parent uses the equity method, what is the amount reported as consolidated retained earnings on December $31,2021?$

What would be the amount of consolidated retained earnings on December $31,2021,$ if the parent had applied either the initial value or partial equity method for internal accounting purposes?

b$.$ Under each of the following situations, what is the Investment in Rambis account balance on Herbert$$s books on January $1,2021?$

The parent uses the equity method.

The parent uses the partial equity method.

The parent uses the initial value method.

c$.$ Under each of the following situations, what is Entry $*$C on a $2021$ consolidation worksheet?

The parent uses the equity method.

The parent uses the partial equity method.

The parent uses the initial value method.

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