Ping Corporation paid $300,000 cash for 80% of the outstanding common stock of Spring Company on January 1, 2019. There was no control premium and the fair value of the noncontrolling interest was $75,000 on January 1, 2019. Differences between book value and fair value of the net identifiable assets of Spring Company on January 1, 2019, were limited to the following:

Book valueFair value

Inventories$20,000$31,000

Equipment (net)180,000173,000

Required:

(i)Prepare the working paper elimination entries E and R (in journal entry format) for Ping Corporation and subsidiary on January 1, 2019.

(ii) Complete the following working paper:

Working paper for consolidated balance sheet on date of business combination, January 1, 2019

PingSpring Adjustments & EliminationsConsolidated

Dr (Cr)Dr (Cr) DebitsCredits Dr (Cr)

Cash 50,00030,000

Inventories 140,000 20,000

Investment in Spring300,000

Equipment (net) 460,000 180,000

Accounts payable-300,000-110,000

Common stock -200,000-40,000

Add. paid-in capital-300,000-20,000

Retained earnings-150,000-60,000

Total 00