How to prepare eliminating entries?

Chapter 6 Elimination of Unrealized Profit on Intercompany Sales of Inventory PROBLEM 6-14 Upstream and Downstream Workpaper-Partial Equity Method LO 6. On January 1, 2018, Perry Company purchased 80% of Selby Company for $960,000. At that time Selby had capital stock outstanding of $400,000 and retained earnings of $400.000 The fair value of Selby Company's assets and liabilities is equal to their book value except for the following: COMPREHENSIVE Fair Value Book Value Inventory Plant and Equipment (10-year life) S230.000 $155.000 79,00 800.000 600.000 299,00 One-half of the inventory was sold in 2018; the remainder was sold in 2019. At the end of 2018, Perry Company hac in its ending inventory $54.000 of merchandise it had purchased from Selby Company during the year. Selby Company sold the merchandise at 20% above cost. During 2019, Perry Company sold merchandise to Selby Company for $300,000 at a markup of 20% of the selling price. At December 31, 2019. Selby still had merchandise that it pur- chased from Perry Company for $78.000 in its inventory. Financial data for 2019 are presented here: Perry Company Selby Company Sales $1.385.000 $ 720,000 Equity in Subsidiary Income 208.000 Total Revenue 1,593,000 720,000 Cost of Goods Sold: Beginning Inventory 210,000 155.000 Purchases 875.000 360,000 Cost of Goods Available 1,085.000 515,000 Less: Ending Inventory 400,000 225,000 Cost of Goods Sold 685.000 290,000 Other Expenses 225,000 170,000 Total Cost and Expense 910.000 460,000 Net Income $ 683,000 $ 260.000 1/1 Retained Earnings $1,472,700 $ 450,000 Net Income 683,000 260.000 Dividends Declared (40,000) (30.000) 12/31 Retained Earnings $2,115,700 $ 680.000 Cash $ 90,000 65,000 Accounts Receivable (net) 297,000 85,000 Inventory 400,000 225.000 Investment in Selby Company 1,184,000 Plant and Equipment (net) 880,000 540.000 Other Assets (net) 384,000 230,000 Total Assets $3.235,000 $1,145,000 Accounts Payable $ 24,300 $ 25,000 Other Liabilities 95.000 40.000 Common Stock 1.000.000 400,000 Retained Earnings 2,115,700 680,000 Total Liabilities and Equity $3,235.000 $1,145,000 Required: A. Prepare the consolidated statements workpaper for the year ended December 31, 2019. B. Calculate consolidated retained earnings on December 31, 2019, using the analytical or l-account approach. Chapter 6 Elimination of Unrealized Profit on Intercompany Sales of Inventory PROBLEM 6-14 Upstream and Downstream Workpaper-Partial Equity Method LO 6. On January 1, 2018, Perry Company purchased 80% of Selby Company for $960,000. At that time Selby had capital stock outstanding of $400,000 and retained earnings of $400.000 The fair value of Selby Company's assets and liabilities is equal to their book value except for the following: COMPREHENSIVE Fair Value Book Value Inventory Plant and Equipment (10-year life) S230.000 $155.000 79,00 800.000 600.000 299,00 One-half of the inventory was sold in 2018; the remainder was sold in 2019. At the end of 2018, Perry Company hac in its ending inventory $54.000 of merchandise it had purchased from Selby Company during the year. Selby Company sold the merchandise at 20% above cost. During 2019, Perry Company sold merchandise to Selby Company for $300,000 at a markup of 20% of the selling price. At December 31, 2019. Selby still had merchandise that it pur- chased from Perry Company for $78.000 in its inventory. Financial data for 2019 are presented here: Perry Company Selby Company Sales $1.385.000 $ 720,000 Equity in Subsidiary Income 208.000 Total Revenue 1,593,000 720,000 Cost of Goods Sold: Beginning Inventory 210,000 155.000 Purchases 875.000 360,000 Cost of Goods Available 1,085.000 515,000 Less: Ending Inventory 400,000 225,000 Cost of Goods Sold 685.000 290,000 Other Expenses 225,000 170,000 Total Cost and Expense 910.000 460,000 Net Income $ 683,000 $ 260.000 1/1 Retained Earnings $1,472,700 $ 450,000 Net Income 683,000 260.000 Dividends Declared (40,000) (30.000) 12/31 Retained Earnings $2,115,700 $ 680.000 Cash $ 90,000 65,000 Accounts Receivable (net) 297,000 85,000 Inventory 400,000 225.000 Investment in Selby Company 1,184,000 Plant and Equipment (net) 880,000 540.000 Other Assets (net) 384,000 230,000 Total Assets $3.235,000 $1,145,000 Accounts Payable $ 24,300 $ 25,000 Other Liabilities 95.000 40.000 Common Stock 1.000.000 400,000 Retained Earnings 2,115,700 680,000 Total Liabilities and Equity $3,235.000 $1,145,000 Required: A. Prepare the consolidated statements workpaper for the year ended December 31, 2019. B. Calculate consolidated retained earnings on December 31, 2019, using the analytical or l-account approach