Cost method, 80% interest, worksheet, statements. Bell Corporation purchased all of the outstanding stock of Stockdon Corporation for $220,000 in cash on January 1, 20X7. On the purchase date, Stockdon Corporation had the following condensed balance sheet:

Assets	Liabilities and Equity
Cash	$60,000	Liabilities	$150,000
Inventory	40,000	Common stock ($10 par)	100,000
Land	120,000	Paid-in capital in excess of par	50,000
Building (net)	180,000	Retained earnings	100,000
Total assets	$400,000	Total liabilities and equity	$400,000

Any excess of book value over cost was attributable to the building, which is currently overstated on Stockdon’s books. All other assets and liabilities have book values equal to fair values. The building has an estimated 10-year life with no salvage value. The trial balances of the two companies on December 31, 20X7, appear as follows:

Bell	Stockdon
Cash	180,000	143,000
Inventory	60,000	30,000
Land	120,000	120,000
Buildings (net)	600,000	162,000
Investment in Stockdon Corp	220,000
Accounts Payable	405,000	210,000
Common Stock ($3 par)	300,000
Common Stock ($10 par)	100,000
Paid-In Capital in Excess of Par	180,000	50,000
Retained Earnings, Jan 1, 20X7	255,000	100,000
Sales	210,000	40,000
Cost of Goods Sold	120,000	35,000
Other Expenses	45,000	10,000
Dividends Declared	5,000
Total	0	0

Required

1. Prepare a determination and distribution of excess schedule for the investment.

2. Prepare the 20X7 consolidated worksheet. Include columns for the eliminations and adjustments, the consolidated income statement, the controlling retained earnings, and the consolidated balance sheet.

3. Prepare the 20X7 consolidated statements, including the income statement, retained earnings statement, and balance sheet.