Data for Planet Two Communications and its wholly-owned subsidiary, Stage 4 Networks, are given below. PlanetTwo acquired Stage 4 on January 1, 2009. PlanetTwo uses the complete equity method to report its investment in Stage 4, and its accounting year ends December 31.

Required

a. Calculate the original goodwill reported for this acquisition.

b. Calculate the equity in net income for 2017, reported on PlanetTwo’s books, using the complete equity method.

c. Calculate the balance in Investment in Stage 4 Networks at December 31, 2017, reported on PlanetTwo’s books.

d. Prepare the eliminating entries necessary to consolidate the financial statements of PlanetTwo and Stage 4 for 2017.

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(in thousands) Acquisition cost... Stage 4's stockholders' equity, January 1, 2009.. Stage 4's total reported net income, 2009-2016.. Stage 4's total dividends paid, 2009-2016.... Stage 4's reported net income, 2017....... Dividends declared and paid by Stage 4, 2017.... Allocation of excess of cost over book value to identifiable net assets, at acquisition date: Land.... Buildings (20-year life, straight-line). Identifiable intangibles (5-year life).. Long-term debt discount (10 years to maturity as of January 1, 2009). Goodwill impairment loss, 2009-2016.... Goodwill impairment loss, 2017..... $8,000 2,000 7,000 1,000 500 50 600 (800) 1,500 100 200 45