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Indicated by parentheses). Michael acquired all of Aaron's outstanding voting stock on January 1, 2017. by Issuing 20,000 shares of Its own $1 par common stock. On the acquisition date, Michael Company's stock actively traded at $3250 per share. Aaron Company 12/31/21 $ (418,588) 164,250 181,500 Revenues Cost of goods sold Amortization expense Dividend income Net income Retained earnings, 1/1/21 Net income (above) Dividends declared Retained earnings, 12/31/21 Cash Receivables Inventory Investment in Aaron Company Copyrights Royalty agreements Total assets Liabilities Preferred stock Connon stock Additional paid-in capital Retained earnings, 12/31/21 Total liabilities and equity Michael Company 12/31/21 $ (689,588) 389,750 119,780 (5,000 $ (265, e5e) $(1,602,00) (265,658) 90,00 $(1,177,ese) $ 192,000 447,eee 642,00 650, eee 545, eee 1, e81, eee $ 3,477,eee $(1,199,958) (388,888) (588,eee) (388,eee) (1,177,ese) $(3,477,eee) $ (152,758) $ (730, eee) (152,750) 5.ee $ (877,750) $ 19, 180 231, eee 365,000 387,000 416,eee $ 1,418,100 $ (410,358) (188,eee) (30,eee) (877,750) $(1,418,188) On the date of acquisition, Aaron reported retained earnings of $410,000 and a total book value of $540,000. At that time, Its royalty agreements were undervalued by $60,000. This Intangible was assumed to have a six-year remaining life with no residual value. Additionally, Aaron owned a trademark with a fair value of $50,000 and a 10-year remaining life that was not reflected on its books. Aaron declared and paid dividends in the same period. a. Using the preceding Information, prepare a consolidation worksheet for these two companies as of December 31, 2021. b. Assuming that Michael applied the equity method to this Investment, what would the following account balances be on the parent's Individual financial statements? Complete this question by entering your answers in the tabs below. Required A Required B Using the preceding information, prepare a consolidation worksheet for these two companies as of December 31, 2021. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet. Amounts in the Debit and Credit columns should be entered as positive. Input all amounts as positive values.) Show less Consolidated Total Accounts Revenues Cost of goods sold Amortization expense Dividend income Net Income MICHAEL COMPANY AND CONSOLIDATED SUBSIDIARY Consolidation Worksheet For Your Ending December 31, 2021 Concollation Entries Mohal Aaron Debit Credit $ (629.00 $ (418.500 309.750 164250 119.700 101,500 (5.000 $ 265.00 5 (152.750 Retained aming, 1/1/21 Mchael Retained Gaming, 11/21 Aaron Not income above Dividends declared Robined carnings 1231/21 11.002.000 ol 265.00) 90.000 $11.177.00 $ 0 (730,000 (152.750) 5.000 (877,750) $ Cash Rovables Inventory Investment in Aaron Co. Copyrights Royalty Agreements Trademark Total assets 192,000 $ 447.000 642.000 660.000 545.000 1,001,000 3,477.000 $ 19.100 221,000 365.000 0 397,000 416.000 0 1,418,100 $ Lab Preferred stock Common stock | Additional paidan capital Retained comings, 12/31/21 (above) Total lobes and equity $ 1.199,950 $ (410,250 (300,000) (500,000) (100,000 300,000 (30,000 (1.177,050 (877.750 $ 12.477.000 $11.418.100 $ os Required A Required B > Complete this question by entering your answers in the tabs below. Required A Required B Assuming that Michael applied the equity method to this investment, what would the following account balances be on the parent's individual financial statements? Amounts Equity in Earnings of Aaron 12/31/21 Retained earnings, 1/1/21 Investment in Aaron 12/31/21 Retained earnings, 12/31/21