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The individual financial statements for Gibson Company and Keller Company for the year ending December 31, 2018, follow. Gibson acquired a 60 percent interest in Keller on January 1, 2017, in exchange for various considerations totaling $390,000. At the acquisition date, the fair value of the noncontrolling interest was $260,000 and Keller's book value was $510,000. Keller had developed internally a customer list that was not recorded on its books but had an acquisition-date fair value of $140,000. This intangible asset is being amortized over 20 years Gibson sold Keller land with a book value of $65,000 on January 2, 2017, for $130,000. Keller still holds this land at the end of the current year Keller regularly transfers inventory to Gibson. In 2017, it shipped inventory costing $133,000 to Gibson at a price of $190,000. During 2018, intra-entity shipments totaled $240,000, although the original cost to Keller was only $156,000. In each of these years, 20 percent of the merchandise was not resold to outside parties until the period following the transfer. Gibson owes Keller $60,000 at the end of 2018 Gibson Company Keller Company Sales Cost of goods sold Operating expenses Equity in earnings of Keller $ (840,000) (540,000) 340,000 45,000 540,000 140,000 93,000 $ (253,000 $ (1,156,000) Net income (155,000) Retained earnings, 1/1/18 Net income (above) Dividends declared (640,000) (253,00e) (155,000) 45,000 (1,274,000) (750,000) $ 173,000 100,000 450,000e 360,000 135,000 Retained earnings, 12/31/18 Cash Accounts receivable Inventor Investment in Keller Land Buildings and equipment (net) 364,000 430,000 798,000 150,000 500,000 430,000 340,000 Total assets Liabilities Common stock Additional paid-in capital Retained earnings, 12/31/18 $2,415,0001,680,000 $ (511,0) (630,000) (490,000) (360,000) (80,000) (1,274,009)_ 750,009) (1,680,000) Total liabilities and equities $ (2,415,000 (Note: Parentheses indicate a credit balance.) a. Prepare a worksheet to consolidate the separate 2018 financial statements for Gibson and Keller b. How would the consolidation entries in requirement (a) have differed if Gibson had sold a building with a $80,000 book value (cost of $180,000) to Keller for $140,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life at Consolidation Worksheet For the Year Ending December 31, 2018 Consolidation Entries Noncontrolling Consolidated Accounts Gibson Keller Debit Credit Interest Totals $ (840,000)$ 540,000) 340,000 45,000 Sales Cost of goods sold Operating expenses Equity in earnings of Keller Separate company net income Consolidated net income 540,000 140,000 (93,000) S (253,000)155,000) To noncontrolling interest To Gibson Company Retained earnings, 1/1-Gibson Retained earnings, 1/1-Keller Net income Dividends declared $ (1,156,000) (640,000) (155,000) 45,000 $ (1,274,000)$ 750,000) $ 173,000$ 100,000 450,000 360,000 (253,000) 135,000 Retained earnings, 12/31 Cash Accounts receivable Inventory Investment in Keller Land Buildings and equipment (net) Customer list 364,000 430,000 798,000 150,000 500,000 430,000 340,000 Total assets Liabilities Common stock Additional paid-in capital Retained earnings, 12131 NCI in Keller, 1/1 NCI in Keller, 12/31 $ 2,415,000$ 1,680,000 S (511,000)(490,000) (360,000) (80,000) (750,000) (630,000) (1,274,000) Total liabilities and equity $ (2,415,000)$ (1,680,000)$ Required B Required A Required B . :How would the consolidation entries in requirement (a) have differed if Gibson had sold a building with a $80,000 book value (cost of $180,000) to Keller for $140,000 instead of land, as the problem reports? Assume that the building had a 10-year remaining life at the date of transfer. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list Consolidation Worksheet Entries 2 Prepare Entry TA to defer the intra-entity gain as of the beginning of the year. Note: Enter debits before credits Transaction Accounts Debit Credit Record entry Clear entry view consolidation entries Required A Required B

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