Pico acquired 90% of Salsas outstanding shares on January 2016 for $342,000 in cash. On that date, the noncontrolling interest had a fair value of $38,000 and Salsas common stock and retained earnings accounts were $150,000 and $176,000, respectively. Salsa owned a building with a nine-year remaining life that was undervalued by $18,000. Any remaining excess cost was attributable to unpatented technology having a six-year life. Salsa sells inventory to Pico as follows: Year Cost to Salsa Transfer Price to Pico Inventory remaining at year end (at transfer price) 2016 $69,000 $115,000 $25,000 2017 81,000 135,000 37,500 2018 92,800 160,000 50,000 At December 31, 2018, Pico owes Salsa $16,000 for inventory it purchased during the period. Financials as of December 31, 2018 are attached.

	Pico	Salsa
Sales revenues	(862,000)	(366,000)
Cost of goods sold	515,000	209,000
Expenses	185,400	67,000
Equity in subisidiary income	(68,400)	-
Net income	(230,000)	(90,000)
Retained earnings 1/1/18	(488,000)	(278,000)
Net income	(230,000)	(90,000)
Dividends	136,000	27,000
Retained earnings 12/31/18	(582,000)	(341,000)
Cash and receivables	146,000	98,000
Inventory	255,000	136,000
Investment in Salsa	450,000	-
Land, buildings and equipment, net	964,000	328,000
Total assets	1,815,000	562,000
Liabilities	(718,000)	(71,000)
Common stock	(515,000)	(150,000)
Retained earnings, 12/31/18	(582,000)	(341,000)
Total liabilities and equity	(1,815,000)	(562,000)

1) Prepare the elimination entries