On January 1, 2024, Palmero Company purchased an 80% interest in Santos Company for $2,800,000, at which time Santos Company had retained earnings of $1,000,000 and capital stock of $500,000. On the date of acquisition, the fair value of the assets and liabilities of Santos Company was equal to their book value, except for property and equipment (net), which had a fair value of $1,500,000 and a book value of $600,000. The property and equipment had an estimated remaining life of 10 years. Palmero Company reported net income from independent operations of $400,000 in 2024 and $425,000 in 2025. Santos Company reported net income of $300,000 in 2024 and $400,000 in 2025. Neither company declared dividends in 2024 or 2025. Palmero uses the cost method to account for its investment in Santos.

Required:
A. Prepare in general journal form the entries necessary in the consolidated statements workpapers for the years ended December 31, 2024 and 2025.
B. Prepare a schedule or t- account showing the calculation of the controlling and noncontrolling interest in consolidated net income for the years ended December 31, 2024 and December 31, 2025.