Chapman Company obtains 100 percent of Abernethy Companys stock on January 1, 2017. As of that date, Abernethy has the following trial balance:

	Debit			Credit
Accounts payable				$	53,700
Accounts receivable	$	41,000
Additional paid-in capital					50,000
Buildings (net) (4-year remaining life)		184,000
Cash and short-term investments		77,250
Common stock					250,000
Equipment (net) (5-year remaining life)		400,000
Inventory		117,500
Land		107,500
Long-term liabilities (mature 12/31/20)					173,000
Retained earnings, 1/1/17					417,450
Supplies		16,900
Totals	$	944,150		$	944,150

During 2017, Abernethy reported net income of $98,000 while declaring and paying dividends of $12,000. During 2018, Abernethy reported net income of $128,250 while declaring and paying dividends of $39,000.

Assume that Chapman Company acquired Abernethys common stock for $851,300 in cash. As of January 1, 2017, Abernethys land had a fair value of $124,200, its buildings were valued at $254,400, and its equipment was appraised at $378,500. Chapman uses the equity method for this investment.

Prepare consolidation worksheet entries for December 31, 2017, and December 31, 2018. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

(a) Prepare entry S to eliminate stockholders' equity accounts of subsidiary

(b) Prepare entry A to recognize allocations attributed to fair value of specific accounts at acquisition date with residual fair value recognized as goodwill. (c) Prepare entry I to eliminate 98000 income accrual for 2017 less 13,300 amortization recorded by parent using equity method

(d) Prepare entry D to eliminate intra-entity dividend transfers

(e) Prepare entry E to recognize current year amortization expense (f) Prepare entry S to eliminate beginning stockholders' equity of subsidiary - the retained earnings account has been adjusted for 2017 income and dividends. Entry *C is not needed because equity method was applied. (g) Prepare entry A to recognize allocations relating to investment - balances shown here are as of beginning current year (original allocation less excess amortizations for the prior period). (h) Prepare entry I to eliminate $128,250 income accrual less $13,300 amortization recorded by parent during 2018 using equity method.

(i) Prepare entry D to eliminate intra-entity dividend transfers (j) Prepare entry E to recognize current year amortization expense