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On January 1, 2010, Pierson Corporation exchanged $1,710,000 cash for 90 percent of the outstand- ing voting stock of Steele Company. The consideration transferred by Pierson provided a reasonable basis for assessing the total January 1, 2010, fair value of Steele Company. At the acquisition date, Steele reported the following owner's equity amounts in its balance sheet: Common stock ... Additional paid-in capital Retained earnings $400,000 60,000 265,000 In determining its acquisition offer, Pierson noted that the values for Steele's recorded assets and liabilities approximated their fair values. Pierson also observed that Steele had developed internally a customer base with an assessed fair value of $800,000 that was not reflected on Steele's books. Pierson expected both cost and revenue synergies from the combination. At the acquisition date, Pierson prepared the following fair-value allocation schedule: Fair value of Steele Company Book value of Steele Company Excess fair value to customer base (10-year remaining life) to goodwill $1,900,000 725,000 1,175,000 800,000 $ 375,000 At December 31, 2011, the two companies report the following balances: Steele (675,000) 322,000 120,000 11,000 7,000 Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Steele Net income Retained earnings, 1/1 Net income... Dividends paid Retained earnings, 12/31 Current assets Investment in Steele Buildings and equipment Copyrights Total assets Accounts payable Notes payable Common stock Additional paid-in capital Retained earnings, 12/31 Total liabilities and equities Plerson (1,843,000) 1,100,000 125,000 275,000 27,500 (121,500) (437,000) (2.625,000) (437,000) 350,000 (2.712,000) 1.204,000 1,854,000 931,000 950,000 4.939,000 (485,000) (542,000) (900,000) (300,000 (2.712,000 (4.939,000 (215,000) (395,000) (215,000) 25,000 (585,000 430,000 863,000 107.000 1,400,000 (200,000) (155,000) (400,000) (60,000) (585,000 (1.400.000 4. Using the acquisition method, determine the consolidated balances for this business com tion as of December 31, 2011, If instead the noncontrolling interest's acquisition-date fair value is assessed at $152,500, what changes would be evident in the consolidated statements

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