Pesto Company consolidates its subsidiary, Salsa. Information on intercompany transactions for 2020 is as follows:

1. During 2017, Salsa sold Pesto land for $600. The land had originally cost Salsa $200. The land is still held by Pesto.

2. In 2020, Salsa sells merchandise to Pesto on a regular basis, at a markup of 20% over cost. In 2020, Salsa sold merchandise to Pesto at a price of $25,000. Pestos beginning inventory for 2020 contained $1,320 in merchandise purchased from Salsa; Pestos ending inventory contains $1,500 in merchandise purchased from Salsa.

3. At the beginning of 2018, Pesto sold Salsa equipment for $40,000. The equipment had been carried on Pestos books at a cost of $50,000 and accumulated depreciation of $35,000. As of the date of sale, the equipment had a 10-year remaining life, straight-line. Salsa still holds the equipment at the end of 2020.

Required

Prepare, in journal entry form, the required eliminating entries for the three intercompany transactions, for the December 31, 2020 consolidation working paper.