2-McKinney Company acquires an 60% interest in its Sandstone for a purchase price of $1.000,000. The excess of the purchase price over the book value of the Sandstones Stockholders Equity is allocated to a building (in PPE, net) that is worth $212,250 more than its book value, an unrecorded Patent that the parent valued at $125,000, and Goodwill of $348,417, 60% of which is allocated to the parent.

The parent and the Sandstone report the following balance sheets on the acquisition date:

	McKinney	Sandstone			McKinney	Sandstone
Cash	$1,500,000	$300,000		Current Liabilities	$750,000	$300,000
Accounts receivable	1,597,500	240,000		Long-term Liabilities	1,268,222	410,000
Inventory	2,689,550	275,000		Common Stock	235,000	75,000
Equity Investment	1,000,000			APIC	5,472,211	156,000
PPE, net	6,008,510	876,000		Retained Earnings	5,070,127	750,000
	$12,795,560	$1,691,000			$12,795,560	$1,691,000

Required: Prepare the consolidation journal entries on the acquisition date.