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On January 1, 2020, Mcllroy, Inc, acquired a 60 percent interest in the common stock of Stinson, Inc., for $391,800. Stinson's book value on that date consisted of common stock of $100,000 and retained earnings of $231600. Also, the acquisition date fair value of the 40 percent noncontrolling Interest was $261,200. The subsidiary held patents (with a 10-year remaining life) that were undervalued within the company's accounting records by $85,600 and an unrecorded customer list (15-year remaining life) assessed at a $61.800 fair value. Any remaining excess acquisition date fair value was assigned to goodwill. Since acquisition, Mcllroy has applied the equity method to its Investment in Stinson account and no goodwill impairment has occurred. At year-end, there are no intra-entity payables or receivables Intra-entity inventory sales between the two companies have been made as follows: Year 2e2e 2021 Cost to McIlroy $137,100 113,400 Transfer Price to Stinson $171, 375 151, 2ee Ending Balance (at transfer price) $57,125 37,888 The individual financial statements for the two companies as of December 31, 2021, and the year then ended follow McIlroy, Inc. $ (755,800 496,200 201,455 (37.567) $ (94,912) $ (824,900) Stinson, Inc $ (395,000) 241,000 82,869 Sales Cost of goods sold Operating expenses Equity in earnings in Stinson Net income Retained earnings, 1/1/21 $ (72,880) $(285,700) The individual financial statements for these two companies as of December 31, 2021, and the year then ended follow Stinson, Inc. $ (395,000) 241,800 82,800 Sales Cost of goods sold Operating expenses Equity in earnings in Stinson Net income Retained earnings, 1/1/21 Net income Dividends declared Retained earnings, 12/31/21 Cash and receivables Inventory Investment in Stinson Buildings (net) Equipment (net) Patents (net) Total assets Liabilities Common stock Retained earnings, 12/31/21 Total liabilities and equities McIlroy, Inc. $ (755, 000) 496, 200 201,455 (37,567) $ (94,912) $ (824,980) (94,912) 50,800 $ (869,012) $ 295,500 277,600 430, 314 364,800 259,700 @ $ 1,627, 114 $ (458,182) (300,000) (869,012) $(1,627,114) $ (72,000) $ (285, 700 (72,000) 2e, 800 $ (336,900) $ 153, 4ee 133,600 e 208,000 91,500 26,400 $ 612,900 $ (176,000) (1 , ) (336,900) $ (612,900) (Note: Parentheses indicate a credit balance) a. Show how Mcllroy determined the $430,314 Investment in Stinson account balance. Assume that Mcllroy defers 100 percent of downstream intra-entity profits against its share of Stinson's income. b. Prepare a consolidated worksheet to determine approprate balances for external financial reporting as of December 31, 2021 Complete this question by entering your answers in the tabs below. Required A Required B Show how Mcllroy determined the $430,314 Investment in Stinson account balance. Assume that McIlroy defers 100 percent of downstream intra-entity profits against its share of Stinson's income. (Amounts to be deducted should be indicated with a minus sign.)

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