On January $1,2023,$ Corgan Company acquired $80$ percent of the outstanding voting stock of Smashing, Incorporated, for a total of $$1,440,000$ in cash and other consideration. At the acquisition date, Smashing had common stock of $$870,000,$ retained earnings of $$420,000,$ and a noncontrolling interest fair value of $$360,000.$ Corgan attributed the excess of fair value over Smashing's book value to various covenants with a $20-$year remaining life. Corgan uses the equity method to account for its investment in Smashing.

During the next two years, Smashing reported the following:

Items Net Income Dividends Declared Inventory Purchases from Corgan

$2023$ $ $320,000$ $ $52,000$ $ $270,000$

$2024300,00062,000290,000$

Corgan sells inventory to Smashing using a $60$ percent markup on cost$.$ At the end of $2023$ and $2024,40$ percent of the current year purchases remain in Smashing's inventory.

Required:

Compute the equity method balance in Corgan's Investment in Smashing, Incorporated, account as of December $31,2024.$

Prepare the worksheet adjustments for the December $31,2024,$ consolidation of Corgan and Smashing $($Entries G$,$ S$,$ A$,$ I, D$,$ E$,$ TI$,$ and G are required$).$

Please explain the calculations as I would like to learn from them!