P5-39 Comprehensive Problem: Majority-Owned Subsidiary Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for $160,000. On that date, the fair value of the noncontrolling interest was $40,000, and Slice reported retained earnings of $50,000 and had $100,000 of common stock outstanding. Pizza has used the equity method in accounting for its investment in Slice. Trial balance data for the two companies on December 31, 20X5, are as follows: Pizza Corporation Slice Products Company Item Debit Credit Debit Credit Cash & Receivables S 81.000 $ 65,000 Inventory 260,000 90,000 Land 80,000 80,000 Buildings & Equipment 500,000 150.000 Investment in Slice Products 188,000 Cost of Goods Sold 120,000 50,000 Depreciation Expense 25,000 15,000 Inventory Losses 15.000 5,000 Dividends Declared 30,000 10,000 Accumulated Depreciation $ 205.000 $105,000 Accounts Payable 60,000 20,000 Notes Payable 200,000 50,000 Common Stock 300,000 100.000 Retained Earnings 314,000 90,000 200,000 100,000 Sales Income from Slice Products 20,000 $1,299.000 $1,299,000 $465,000 $465,000 Additional Information 1. On the date of combination, the fair value of Slice's depreciable assets was $50,000 more than book value. The accumulated depreciation on these assets was $10,000 on the acquisition date. The differential assigned to depreciable assets should be written off over the following 10-year period. 2. There was $10,000 of intercorporate receivables and payables at the end of 20X5. Required a. Give all journal entries that Pizza recorded during 20X5 related to its investment in Slice. b. Give all consolidation entries needed to prepare consolidated statements for 20X5. c. Prepare a three-part worksheet as of December 31, 20X5. Note that you do not need to prepare the three part worksheet.