Phone Corporation acquired 70 percent of Smart Corporations common stock on December 31, 20X4, for $95,200. At that date, the fair value of the noncontrolling interest was $40,800. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition:

	Phone					Smart
Item	Corporation					Corporation
Cash		$	61,300				$	25,000
Accounts Receivable			90,000					50,000
Inventory			149,000					94,000
Land			79,000					50,000
Buildings & Equipment			414,000					263,000
Less: Accumulated Depreciation			(165,000	)				(71,000	)
Investment in Smart Corporation			95,200
Total Assets		$	723,500				$	411,000
Accounts Payable		$	148,500				$	27,000
Mortgage Payable			290,000					269,000
Common Stock			77,000					37,000
Retained Earnings			208,000					78,000
Total Liabilities & Stockholders Equity		$	723,500				$	411,000

At the date of the business combination, the book values of Smarts assets and liabilities approximated fair value except for inventory, which had a fair value of $100,000, and buildings and equipment, which had a fair value of $207,000. At December 31, 20X4, Phone reported accounts payable of $13,500 to Smart, which reported an equal amount in its accounts receivable.

Required: a. Prepare the consolidation entry or entries needed to prepare a consolidated balance sheet immediately following the business combination. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Record the basic consolidation entry.

Record the excess value (differential) reclassification entry.

Record the entry to eliminate the intercompany accounts.

Record the optional accumulated depreciation consolidation entry.

b. Prepare a consolidated balance sheet worksheet. (Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be entered as positive values. For accounts where multiple adjusting entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.)

c. Prepare a consolidated balance sheet in good form. (Amounts to be deducted should be indicated with a minus sign.)