Prepare the consolidation worksheet

TOPIC REVIEW 6.5 Constructive Retirement of Intercompany Debt-Equity Method Assume that a parent company acquires a 90% interest in its subsidiary on January 1, 2018. On the date of acquisition, the fair value of the 90 percent controlling interest was $594,000 and the fair value of the 10 percent noncontrolling interest was $66,000. On January 1,2018 , the book value of net assets equaled $660,000 and the fair value of the identifiable net assets equaled the book value of identifiable net assets (i.e., there was no AAP or Goodwill). On December 31, 2019, the parent company issued $1,200,000 (face) 6 percent, five-year bonds to an unaffiliated company for $1,251,954 (i.e., the bonds had an effective yield of 5 percent). The bonds pay interest annually on December 31 , and the bond premium is amortized using the straight-line method. This results in annual bond-payable premium amortization equal to $10,391 per year. On December 31,2021 , the subsidiary paid $1,138,150 to purchase all of the outstanding parent company bonds (i.e., the bonds had an effective yield of 8 percent). The bond discount is amortized using the straight-line method, which results in annual bondinvestment discount amortization equal to $20,617 per year. The parent uses the equity method of preconsolidation investment bookkeeping. The parent and the subsidiary report the following financial statements for the year ended December 31, 2022: Amortization tables