The individual financial statements for Company A and Company B for the year ending December 31, 2018, follow. Company A acquired a 60 percent interest in Company B on January 1, 2017, in exchange for various considerations totaling $840,000. At the acquisition date, the fair value of the noncontrolling interest was $560,000 and Company Bs book value was $1,120,000. Company B had developed internally a customer list that was not recorded on its books but had an acquisition-date fair value of $280,000. This intangible asset is being amortized over 20 years.

Company A sold Company B land with a book value of $90,000 on January 2, 2017, for $190,000. Company B still holds this land at the end of the current year.

Company B regularly transfers inventory to Company A. In 2017, it shipped inventory costing $198,000 to Company A at a price of $330,000. During 2018, intra-entity shipments totaled $380,000, although the original cost to Company B was only $266,000. In each of these years, 20 percent of the merchandise was not resold to outside parties until the period following the transfer. Company A owes Company B $50,000 at the end of 2018.

a. Prepare a worksheet to consolidate the separate 2018 financial statements for Company A and Company B.

b. Prepare US GAAP compliant Balance Sheet and Income Statement as of December 31, 2018, and for the year then ended.

c. How would the consolidation entries in requirement (a) have differed if Company A had sold a building with a $150,000 book value (cost of $320,000) to Company B for $280,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life at the date of transfer. Provide the journal entries; do not make another worksheet or FS