Paragraph Corporation purchased land on January 1, 20X1, for $22,000. On June 10, 20X4, it sold the land to its subsidiary, Sentence Corporation, for $30,000. Paragraph owns 60 percent of Sentences voting shares.

Required:

1. Prepare the worksheet consolidation entries needed to remove the effects of the intercompany sale of land in preparing the consolidated financial statements for 20X4 and 20X5-. Record the consolidating entry on December 31, 20X4. -Record the consolidating entry on December 31, 20X5.
2. Prepare the worksheet consolidation entries needed on December 31, 20X4 and 20X5, if Sentence had initially purchased the land for $22,000 and then sold it to Paragraph on June 10, 20X4, for $30,000.-Record the consolidating entry on December 31, 20X4.-Record the consolidating entry on December 31, 20X5.