Here is the problem: On January 1, 2020, Pong Company acquired 70% of the outstanding common stock of Salt Company for $6,400,000 cash. Pong Company uses the equity method. During 2020, Salt reported $1,200,000 of net income and paid a dividend of $240,000. The stockholders' equity section of the December 31, 2019 balance sheet for Salt was as follows: Common Stock Retained Earnings $4,000,000 $5,142,857 Total Stockholders' Equity $9,142,857 Required: A. Prepare the journal entries to record the investment and the effect of Salt's income and dividends on Pong Company's accounts. B. Prepare the elimination entry that would be made on the worksheet for a consolidated balance sheet as of the date of acquisition, Calibri ce Wap ORL BIU.-A. Merge & Center $ -% 91 board Font Alignment Number B A D E Pong Company General Journal Accounts Date Debit Credit 3 9 0 :1 B 22 23 Worksheet Elimination Entry for Consolidation Purposes Accounts Debit Credit Date 24 25 26 27 28 Sheet1