Parts 1 through 3 should be viewed as independent situations. They are based on the following data: Chapman Company obtains 100 percent of Abernethy Companys stock on January 1, 2011. As of that date, Abernethy has the following trial balance: Debit Credit Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50,000 Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 40,000 Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000 Buildings (net) (4-year life) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120,000 Cash and short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,000 Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250,000 Equipment (net) (5-year life) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000 Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90,000 Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,000 Long-term liabilities (mature 12/31/14) . . . . . . . . . . . . . . . . . . . . . . . . 150,000 Retained earnings, 1/1/11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000 Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000 Totals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $600,000 $600,000 During 2011, Abernethy reported income of $80,000 while paying dividends of $10,000. During 2012, Abernethy reported income of $110,000 while paying dividends of $30,000. 1. Assume that Chapman Company acquired Abernethys common stock for $490,000 in cash. As of January 1, 2011, Abernethys land had a fair value of $90,000, its buildings were valued at $160,000, and its equipment was appraised at $180,000. Chapman uses the equity method for this investment. Prepare consolidation worksheet entries for December 31, 2011, and December 31, 2012. 2. Assume that Chapman Company acquired Abernethys common stock for $500,000 in cash. Assume that the equipment and long-term liabilities had fair values of $220,000 and $120,000, respectively, on the acquisition date. Chapman uses the initial value method to account for its investment. Prepare consolidation worksheet entries for December 31, 2011, and December 31, 2012. 3. Assume that Chapman Company acquired Abernethys common stock by paying $520,000 in cash. All of Abernethys accounts are estimated to have a value approximately equal to present book values. Chapman uses the partial equity method to account for its investment. Prepare the consolidation worksheet entries for December 31, 2011, and December 31, 2012