Pepper Company, which is a calendar-year-reporting company, purchased 100% of the common stock of Salt Company for 10,000 shares of common stock of Pepper Company. On the acquisition date, Pepper Company shares had a par value of $5 per share and a market value of $32.50 per share. On the acquisition date, the following net assets of Salt had fair values different than book value: Cost FMV Inventory Land 80,000 85,000 Turnover 6 times per year 70,000 60,000 Building and equipment 220,000 150,000 10 year life Accumulated depreciation (60,000) Covenant-not-to-complete 40,000 4 year life Bonds payable 150,000 125,000 10 years to maturity During the Company. year ending December 31, 2020, there were no transactions involving the stock of Salt Required: a. Prepare the journal entries made by Pepper Co. to reflect the acquisition of Salt on 12/31/19 and the application of the equity method of accounting during the year ending 12/31/20. b. Complete the Illustration #4a Worksheet" to show the consolidation on 12/31/20.