On January 1, 2014, Spelt Company sold to Pub Corporation, for $120,000, machinery with a book value of $90,000 (including $15,000 of accumulated depreciation), a remaining economic life of six years, and no residual value. Pub adopted the straight-line method of depreciation for the machinery. Pub owns 80% of Spelt's outstanding common stock. Also in 2014, Pub sold land to Spelt that had originally cost Pub $70,000 in 2006. Pub charged Spelt $140,000 for the land. Both transactions were executed in cash.

Required:

A. Prepare Spelt Company's January 1, 2014, journal entry to record the sale of the machinery. Also prepare Pubs journal entry to record the sale of the land.

B. Prepare a working paper for Pub Corporation and subsidiary summarizing the working paper eliminations (in journal entry format) with respect to the machinery and land for the three fiscal years ending 12/31/2016.