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On January 1, 2020, McIlroy, Inc., acquired a 60 percent interest in the common stock of Stinson, Inc., for $372,000. Stinson's book value on that date consisted of common stock of $100,000 and retained earnings of $219,900. Also, the acquisition-date fair value of the 40 percent noncontrolling interest was $248,000. The subsidiary held patents (with a 10-year remaining life) that were undervalued within the company's accounting records by $79,300 and an unrecorded customer list (15-year remaining life) assessed at a $54,900 fair value. Any remaining excess acquisition-date fair value was assigned to goodwill. Since acquisition, McIlroy has applied the equity method to its Investment in Stinson account and no goodwill impairment has occurred. At year-end, there are no intra-entity payables or receivables.

Intra-entity inventory sales between the two companies have been made as follows:

Year	Cost to McIlroy	Transfer Price to Stinson	Ending Balance (at transfer price)
2020	$127,800	$159,750	$53,250
2021	112,800	150,400	37,600

The individual financial statements for these two companies as of December 31, 2021, and the year then ended follow:

	McIlroy, Inc.				Stinson, Inc.
Sales	$	(736,000	)		$	(368,000	)
Cost of goods sold		483,700				224,800
Operating expenses		198,540				76,600
Equity in earnings in Stinson		(34,256	)			0
Net income	$	(88,016	)		$	(66,600	)
Retained earnings, 1/1/21	$	(780,200	)		$	(283,000	)
Net income		(88,016	)			(66,600	)
Dividends declared		48,300				19,000
Retained earnings, 12/31/21	$	(819,916	)		$	(330,600	)
Cash and receivables	$	279,400			$	150,500
Inventory		262,400				131,200
Investment in Stinson		415,112				0
Buildings (net)		339,000				205,600
Equipment (net)		242,000				89,400
Patents (net)		0				24,000
Total assets	$	1,537,912			$	600,700
Liabilities	$	(417,996	)		$	(170,100	)
Common stock		(300,000	)			(100,000	)
Retained earnings, 12/31/21		(819,916	)			(330,600	)
Total liabilities and equities	$	(1,537,912	)		$	(600,700	)

(Note: Parentheses indicate a credit balance.)

1. Prepare a consolidated worksheet to determine appropriate balances for external financial reporting as of December 31, 2021.

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