$On$ December $31st\mathrm{.}2019,X$ Company purchased $70\%of$ the outstanding common shares $of$ the $Y$ Company for $$8\mathrm{.}4$ million $in$ cash. $On$ that date the shareholders$$ equity $ofY$ consisted $of$ $$2$ million $in$ common shares and $$6$ million $in$ retained earnings. Both companies use the FIFO method $to$ account for inventory and the straight$-$line method $to$ calculate depreciation.

For the year ended December $31st.2024,$ the income statements $ofX$ and $Y$ were $as$ follows:

$X.............................................Y$

Sales and other income..............................$$28,800,000.................................$$$13,000,000$

Cost $of$ Goods sold..................................... $18,000,000.................................8,200,000$

Depreciation Expense................................. $3,400,000................................1,800,000$

Income tax and other expenses................... $4,200,000................................1,600,000$

NET INCOME..................................................$ $3,200,000...............................$ $ $1,400,000$

$At$ December $31st,2024,$ the condensed balance sheets for the two companies were $as$ follows:

$X.............................................Y$

Current assets..................................................$$15,000,000.........................$$$8,800,000$

Non$-$current assets............................................ $28,600,000.........................17,400,000$

TOTAL ASSETS....................................................$$43,600,000........................$$$26,200,000$

Liabilities............................................................$$26,400,000........................$$$13,800,000$

Common Shares.................................................. $4,000,000.........................2,000,000$

Retained Earnings................................................ $13,200,000.........................10,400,000$

TOTAL LIABILITIES& OWNERS$$ EQUITY................. $$43,600,000........................$ $$26,200,000$

Additional Information:$-$

$i.On$ December $31st.2019,Y$ had inventory with a fair value that was $$100,000$ less than its carrying value.

$ii.On$ December $31st.2019,Y$ had equipment with a fair value that was $$400,000$ greater than its carrying value. The equipment had a remaining useful life $of8$ years.

iii. $X$ uses the acquisition method for consolidation. Each year goodwill $is$ evaluated $to$ determine $if$ there has been a permanent impairment. Goodwill had a value $of$ $$3,580,000at$ December $31st\mathrm{.}2023$ and $$3,200,000at$ December $31st.2024.$

$iv.On$ January $2nd\mathrm{.}2022,Y$ sold a machine $toX$ for $$1,200,000.Y$ purchased the machine $on$ January $1st.2018$ for $$1,800,000$ and was depreciating the machine over $10$ years. There was $no$ change $in$ the estimated service life $at$ the time $of$ the intercompany sale.

$v.$ During $2024,X$ sold merchandise $toY$ for $$600,000,75\%of$ this remains $inYs$ inventory $at$ December $31st\mathrm{.}2024.On$ December $31st\mathrm{.}2023,$ the inventory $ofY$ contained $$100,000of$ merchandise purchased from $X.X$ earns a gross margin $of30\%on$ its intercompany sales.

$vi.$ During $2024,X$ declared and paid dividends $of$ $$2,600,000$ while $Y$ declared and paid dividends $of$ $$800,00.$

vii. $X$ accounts for its investment using the cost method.

viii. Both companies pay income taxes $at$ the rate $of40\%.$

Required:$-$

$i.$ Calculate the goodwill $at$ the date $of$ acquisition$(5$ marks$)$

$ii.$ Prepare the amortization schedule $to$ December $31st.2024(4$ marks$)$

iii. Prepare the tax schedule for the intercompany sale $of$ the equipment$(4$ marks$)$

$iv.$ Prepare the tax schedule for the intercompany sale $of$ inventory$(2$ marks$)$

$v.$ Calculate consolidated net income for the year $2024(8$ marks$)$