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 $ 58,900 Accounts receivable $ 41,500 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 211,000 Cash and short-term investments 70,750 Common stock 250,000 Equipment (net) (5-year remaining life) 430,000 Inventory 139,000 Land 121,500 Long-term liabilities (mature 12/31/20) 174,000 Retained earnings, 1/1/17 498,450 Supplies 17,600 Totals $ 1,031,350 $ 1,031,350 During 2017, Abernethy reported net income of $120,000 while declaring and paying dividends of $15,000. During 2018, Abernethy reported net income of $170,000 while declaring and paying dividends of $48,000. Assume that Chapman Company acquired Abernethys common stock for $902,200 in cash. As of January 1, 2017, Abernethys land had a fair value of $133,000, its buildings were valued at $277,000, and its equipment was appraised at $393,500. Chapman uses the equity method for this investment. Prepare consolidation worksheet entries for December 31, 2017, and December 31, 2018. 1.Prepare entry S to eliminate stockholders' equity accounts of subsidiary. 2.Prepare entry A to recognize allocations attributed to fair value of specific accounts at acquisition date with residual fair value recognized as goodwill. 3.Prepare entry I to eliminate $120,000 income accrual for 2017 less $9,200 amortization recorded by parent using equity method. 4.Prepare entry D to eliminate intra-entity dividend transfers. 5.Prepare entry E to recognize current year amortization expense. 6.Prepare entry S to eliminate beginning stockholders' equity of subsidiarythe Retained Earnings account has been adjusted for 2017 income and dividends. Entry *C is not needed because equity method was applied. 7.Prepare entry A to recognize allocations relating to investmentbalances shown here are as of beginning of current year [original allocation less excess amortizations for the prior period]. 8.Prepare entry I to eliminate $170,000 income accrual less $9,200 amortization recorded by parent during 2018 using equity method. 9.Prepare entry D to eliminate intra-entity dividend transfers. 10.Prepare entry E to recognize current year amortization expense.