On January 1, 2016, Parent Company acquired 100% of the common stock of Subsidiary Company for $750,000. On this date Subsidiary had total owners' equity of $540,000.Any excess of cost over book value is attributable to land, undervalued $10,000, and to goodwill.

During 2016 and 2017, Parent has appropriately accounted for its investment in Subsidiary using the simple equity method.

On January 1, 2017, Parent held merchandise acquired from Subsidiary for $10,000. During 2017, Subsidiary sold merchandise to Parent for $100,000, of which $20,000 is held by Parent on December 31, 2017. Subsidiary's usual gross profit on affiliated sales is 40%.

On December 31, 2017, Parent still owes Subsidiary $20,000 for merchandise acquired in December.

Required: Using the information in the paragraphs above and the trial balance information in the worksheet below prepare journal entries only ( DO NOT COMPLETE THE WORKSHEET) for eliminating current equity ( E), determination and distribution

	Trial Balance
	Parent	Sub.
Account Titles	Company	Company
Inventory, December 31	100,000	80,000
Other Current Assets	139,000	450,000
Investment in Sub. Company	880,000
Other Long-Term Investments	50,000	30,000
Land	140,000	70,000
Buildings and Equipment	315,000	400,000
Accumulated Depreciation	(280,000)	(110,000)
Other Intangibles	60,000
Current Liabilities	(150,000)	(100,000)
Bonds Payable	(100,000)
Premium on Bonds Payable	(5,000)
Other Long-Term Liabilities	(200,000)	(150,000)
Common Stock P Co.	(200,000)
Other Paid in Capital P Co.	(100,000)
Retained Earnings P Co.	(479,000)
Common Stock S Co.		(100,000)
Other Paid in Capital S Co.		(200,000)
Retained Earnings S Co.		(300,000)
Net Sales	(600,000)	(380,000)
Cost of Goods Sold	350,000	180,000
Operating Expenses	140,000	100,000
Subsidiary Income	(100,000)
Gain on Sale of Equipment	(20,000)
Dividends Declared P Co.	60,000
Dividends Declared S Co.		30,000
Consolidated Net Income