3 Help Save & Exit Submit Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2020. As of that date, Abernethy has the following trial balance Debit Accounts payable Credit $51,900 2011248 Accounts receivable Additional paid-in capital $ 43,100 50,000 Buildings (net) (4-year remaining life) 175,000 Cash and short-term investments 75,500 Common stock 250,000 Equipment (net) (5-year remaining life) 439,500 Inventory 127,000 Land 116,500 Long-term liabilities (mature 12/31/23) Betained earnings, 1/1/20 170,500. 404,000 Supplies Totals 10,700 $987,300 During 2020, Abernethy reported net income of $87,000 while declaring and paying dividends of $11,000 During 2021 Abernethy reported net income of $122.500 while declaring and paying dividends of $55,000, Assume that Chapman Company acquired Abernethy's common stock for $873,250 in cash. As of January 1, 2020 Abemethy's land had a fair value of $129,800, its buildings were valued at $243.800, and its equipment was appraised at $403.750 Chapman uses the equity method for this investment Prepare consolidation worksheet entries for December 31, 2020, and December 31, 2021 (if no entry is required for a transection/event, select "No journal entry required" in the first account field.) Saved equity method for this investment. Prepare consolidation worksheet entries for December 31, 2020, and D transaction/event, select "No journal entry required" in the first accou Prepare entry *C to convert parent's beginning retained earnings to full accrual basis. 2 Prepare entry S to eliminate stockholders' equity accounts of subsidiary. 3 Prepare entry A to recognize allocations attributed to fair value of specific accounts at acquisition date with residual fair value recognized as goodwill. 4 Prepare entry I to eliminate the income accrual for 2020 less the amortization recorded by the parent using the equity method. 5 Prepare entry D to eliminate intra-entity dividend Note: = journal entry has been entered X transaction/event, select "No journal entry required" In the first acce 5 Prepare entry D to eliminate intra-entity dividend transfers. 6 Prepare entry E to recognize current year amortization expense. 7 Prepare entry *C to convert parent's beginning retained earnings to full accrual basis. 8 Prepare entry S to eliminate stockholders' equity accounts of subsidiary for 2021. Prepare entry A to recognize allocations attributed to specific accounts at acquisition date for 2021. Note: == journal entry has been entered X 8 Prepare entry S to eliminate stockholders' equity accounts of subsidiary for 2021. 9 Prepare entry A to recognize allocations attributed to specific accounts at acquisition date for 2021. 10 Prepare entry I to eliminate the income accrual for 2021 less the amortization recorded by the parent using the equity method. 11 Prepare entry D to eliminate intra-entity dividend transfers. 12 Prepare entry E to recognize current year amortization expense. Note: == journal entry has been entered X