Exercise $5-12($Algo$)$ Consolidation Following Three Years of Ownership LO $5-1,5-2$ b$.$ Prepare the consolidation entrles needed at January $1,20$X$7,$ to prepare a consolidated balance sheet.

Note: If no entry is required for a transactlon$/$event$,$ select $"$No journal entry required" In the first account fleld. c$.$ Compute the balance reported by Purchase as its Investment in Steal at December $31,208.$

d$.$ Prepare the journal entries recorded by Purchase with regard to its investment in Steal during $209.$

Note: If no entry is required for a transactlon$/$event$,$ select $"$No journal entry required" In the first account fleld.

Record Purchase Corporation's $60\%$ share of Steal

Corporation's $20$X$9$ income.

Record Purchase Corporation's $60\%$ share of Steal

Corporation's $20$X$9$ dividend.

Record Purchase Corporation's $60\%$ share of the

amortization of the excess acquisition price. e$.$ Prepare the consolidation entries needed at December $31,209,$ to prepare a three$-$part consolidation worksheet.

Note: If no entry is required for a transactlon$/$event$,$ select $"$No journal entry required" In the first account field.

Purchase Corporation purchased $60$ percent of Steal Company ownership on January $1,20$X$7,$ for $$280,500.$ Steal reported the following net income and dividend payments:

Year Net Income Dividends Paid

$20$X$7$ $ $52,000$ $ $32,000$

$20$X$862,00042,000$

$20$X$937,00017,000$

On January $1,20$X$7,$ Steal had $$253,000$ of $$8$ par value common stock outstanding and retained earnings of $$153,000,$ and the fair value of the noncontrolling interest was $$187,000.$ Steal held land with a book value of $$30,500$ and a market value of $$38,000$ and equipment with a book value of $$327,000$ and a market value of $$367,000$ at the date of combination. The remainder of the differential at acquisition was attributable to an increase in the value of patents, which had a remaining useful life of $10$ years. All depreciable assets held by Steal at the date of acquisition had a remaining economic life of eight years.

Required:

Compute the increase in the fair value of patents held by Steal.

Prepare the consolidation entries needed at January $1,20$X$7,$ to prepare a consolidated balance sheet.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Compute the balance reported by Purchase as its investment in Steal at December $31,20$X$8.$

Prepare the journal entries recorded by Purchase with regard to its investment in Steal during $20$X$9.$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Prepare the consolidation entries needed at December $31,20$X$9,$ to prepare a three$-$part consolidation worksheet.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.