On January $1,2019,$ Parent acquired $70\%$ of the outstanding common stock of Subsidiary for $$900,950.$ The fair value of the noncontrolling interest is $$357,550.$ The book value of subsidiary at the date of acquisition consists of common stock $$42,000,$ APIC $$116,500$ and retained earnings $$700,000.$ On the date of acquisition, the book value of subsidiary net assets equals fair value except a patent that has a book value of $$0$ and estimated fair value of $$300,000.$ The patent has an estimated $10$ year life.

Subsidiary sells product to parent. Total intercompany sales in $2022$ and $2021$ are $$170,000$ and $$220,000,$ respectively. At the end of $2022$ and $2021,$ the parent is holding $10\%$ and $25\%$ of the inventory, respectively. Assume the gross profit percentage is the same in both years. Intercompany receivables and payables at the end of $2022$ is $$27,000.$

Parent sold equipment with a book value of $$110,000$ to subsidiary on January $1,2020$ for $$90,000.$ The equipment has a five year remaining life on the date of sale.

On January $1,2021,$ Parent purchased all of the outstanding debt of subsidiary for $$390,000.$ See the debt and investment amortization schedules in the spreadsheet.

On January $1,2022,$ Subsidiary sold land that cost $$250,000$ to Parent for $$300,000.$

Parent uses the equity method to account for its investment in Subsidiary. See the Parent and Subsidiary $2022$ financial statements on the excel spreadsheet.

a$.$ Calculate the accounting acquisition premium, allocate the AAP to the fair value of net assets acquired and calculate goodwill on January $1,2019.$

b$.$ Prepare the equity method journal entries for $2022.$

c$.$ Post the equity method journal entries to the equity income t$-$account. Confirm equity income on the parent$$s books.

d$.$ Prepare the reconciliations of the book value of subsidiary$$s stockholders$$ equity to the equity investment and noncontrolling interest $($NCI$)$ at the beginning of the year and end of the year for $2022.$

e$.$ Calculate consolidated income, income to controlling interest and income to noncontrolling interest for the year ended December $31,2022.$

f$.$ Prepare the consolidating entries for $2022.$

g$.$ Post the consolidating entries to the consolidating worksheet and prepare consolidated financial statements for $2022.$

h$.$ Assume Parent uses the cost method to account for its investment in Subsidiary. Calculate the adjustment for $2022.$

i$.$ Prepare the adjustment and C consolidating entries for $2022.$