On January 2, 2019, Phillips Company purchased 80% of Sanchez Company and 90% of Thomas Company for $225,000 and $168,000, respectively. Immediately before the acquisitions, the balance sheets of the three companies were as follows:

The note receivable and interest receivable of Sanchez relate to a loan made to Thomas Company on October 1, 2018. Thomas failed to record the accrued interest expense on the note.

Required:

Prepare a consolidated balance sheet workpaper as of January 2, 2019. Any difference between book value and the value implied by the purchase price relates to subsidiary land.

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Sanchez Phillips Thomas $ 43,700 $ 20,000 $400,000 Cash Accounts receivable Note receivable 28,000 24,000 10,000 20,000 -0- Interest receivable -0- 300 Inventory Equipment Land 120,000 60,000 180,000 96,000 40,000 80,000 43,000 30,000 70,000 $788,000 $183,000 Total $294,000 Accounts payable Note payable Common stock $ 28,000 $ 20,000 $ 18,000 10,000 75,000 -0- 300,000 120,000 Other contributed capital Retained earnings 300,000 90,000 40,000 160,000 64,000 40,000 $183,000 Total $788,000 $294,000