On January 1, 2013, Mona, Inc., acquired 90 percent of Lisa Companys common stock as well as 70 percent of its preferred shares. Mona paid $87,000 in cash for the preferred stock, with a call value of 110 percent of the $72 per share par value. The remaining 30 percent of the preferred shares traded at a $56,000 fair value. Mona paid $598,500 for the common stock. At the acquisition date, the noncontrolling interest in the common stock had a fair value of $66,500. The excess fair value over Lisas book value was attributed to franchise contracts of $50,000. This intangible asset is being amortized over a 40-year period. Lisa pays all preferred stock dividends (a total of $30,000 per year) on an annual basis. During 2013, Lisas book value increased by $130,000.

On January 2, 2013, Mona acquired one-half of Lisas outstanding bonds payable to reduce the business combinations debt position. Lisas bonds had a face value of $122,000 and paid cash interest of 8 percent per year. These bonds had been issued to the public to yield 10 percent. Interest is paid each December 31. On January 2, 2013, these bonds had a total $101,000 book value. Mona paid $71,000, indicating an effective interest rate of 6 percent.

On January 3, 2013, Mona sold Lisa fixed assets that had originally cost $122,000 but had accumulated depreciation of $80,000 when transferred. The transfer was made at a price of $156,000. These assets were estimated to have a remaining useful life of 15 years.

The individual financial statements for these two companies for the year ending December 31, 2014, are as follows:

	Mona, Inc.		Lisa Company
Sales and other revenues	$	(544,000)	$	(244,000)
Expenses		242,000		142,000
Dividend incomeLisa common stock		(30,000)		0
Dividend incomeLisa preferred stock		(21,000)		0
Net income	$	(353,000)	$	(102,000)
Retained earnings, 1/1/14	$	(722,000)	$	(544,000)
Net income (above)		(353,000)		(102,000)
Dividends declaredcommon stock		114,800		32,000
Dividends declaredpreferred stock		0		30,000
Retained earnings, 12/31/14	$	(960,200)	$	(584,000)
Current assets	$	152,419	$	522,000
Investment in Lisacommon stock		598,500		0
Investment in Lisapreferred stock		87,000		0
Investment in Lisabonds		73,781		0
Fixed assets		1,122,000		822,000
Accumulated depreciation		(322,000)		(222,000)
Total assets	$	1,711,700	$	1,122,000
Accounts payable	$	(429,500)	$	(80,780)
Bonds payable		0
Discount on bonds payable		0		8,780
Common stock		(322,000)		(222,000)
Preferred stock		0		(122,000)
Retained earnings, 12/31/14		(960,200)		(584,000)
Total liabilities and equities	$	(1,711,700)	$	(1,122,000)

a. b. & c.

Prepare consolidation worksheet adjustment for 2013 to record the following. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

1. to eliminate the subsidiarys common and preferred stocks.

2. to account for Monas purchase of Lisas bonds.

3. to account for the intra-entity sale of fixed assets.

a. Preferred Stock (Lisa), Common Stock (Lisa), Retained Earnings (Lisa), Franchises, Investment in Lisa - Common Stock, Investment in Lisa - Preferred Stock, Noncontrolling interest in Lisa

b. Bonds Payable, Interest Income, Loss on retirement of bonds, Discoutn on Bonds Payable, Interest Expense, Investment in Lisa - bonds

c. Gain on transfer of fixed assets, Accumulated Depreciation, Depreciation Expense, Fixed Assets

Assume that consolidated financial statements are being prepared for the year ending December 31, 2014. Calculate the consolidated balance for each of the following accounts:

Franchises _____________ Fixed Assets ___________ Accumulated Depreciation _____________ Expenses _____________