On January 1, 2018, Vacker Co. acquired 70% of Carper Inc. by paying $650,000. This included a $20,000 control premium. Carper reported common stock on that date of $420,000 with retained earnings of $252,000. A building was undervalued in the company's financial records by $28,000. This building had a ten-year remaining life. Copyrights of $80,000 were to be recognized and amortized over 20 years.Carper earned income and paid cash dividends as follows: On December 31, 2020, Vacker owed $30,800 to Carper. There have been no changes in Carper's common stock account since the acquisition.Required:If the equity method had been applied by Vacker for this acquisition, what were the consolidation entries needed as of December 31, 2020?

From the acquisition value, $28,000 was allocated based on the fair value of the building. With a ten-year remaining life, amortization will be $2,800 per year of which $1,960 is attributed to the controlling interest.Copyright amortization would have been $4,000 per year of which $2,800 is attributed to the controlling interest. Goodwill: Vacker paid $650,000 which includes $20,000 premium. Thus, $630,000 represents 70% of the shares without the premium. $630,000 ÷ 70% = $900,000 value of the company without the premium. 30% × $900,000 = $270,000. The total fair value of the company is thus $650,000 that Vacker paid + $270,000 value of the noncontrolling interest shares = $920,000. The fair value of the net assets acquired is $780,000 (= $672,000 + $28,000 + $80,000) . Goodwill attributable to Vacker is $104,000 (= $650,000 − [70% × $780,000]) and the goodwill attributable to the noncontrolling interest is $36,000 (= $270,000 − [30% × $780,000]) .Total differential attributable to Vacker $170,080 [$104,000 + ((22,400 + $72,000) × 70%) ] and differential attributable to the noncontrolling interest is $64,320 [$36,000 + ((22,400 + $72,000) × 30%) ] Beginning NCI = $270,000 + $29,460 (income) − $16,380 (dividends) + $38,280 (income) − $18,480 (dividends) = $302,880