Exercise 7-7 On January 1, 2013, Price Company acquired an 80% interest in the common stock of Smith Company on the open market for $724,800, the book value at that date. On January 1, 2014, Price Company purchased new equipment for $13,800 from Smith Company. The equipment cost $9,200 and had an estimated life of five years as of January 1, 2014. During 2015, Price Company had merchandise sales to Smith Company of $109,500; the merchandise was priced at 25% above Price Company's cost. Smith Company still owes Price Company $19,000 on open account and has 20% of this merchandise in inventory at December 31, 2015. At the beginning of 2015, Smith Company had in inventory $24,200 of merchandise purchased in the previous period from Price Company. (a) Prepare all workpaper entries necessary to eliminate the effects of the intercompany sales on the consolidated financial statements for the year ended December 31, 2015. (If no entry is required, select "No Entry for the account titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To eliminate intercompany sales) (To eliminate intercompany receivables) (To eliminate intercompany profit in ending inventory purchased (To eliminate intercompany profit in ending inventory purchased in current period) (To eliminate intercompany profit in ending inventory purchased in previous period) (To eliminate intercompany profit in equipment) (To eliminate depreciation on equipment)