Preparing the [I] consolidation entries for sale of land

Assume that on June 15, 2012 a parent company sells land that originally cost $250,000 to its wholly-owned subsidiary for a sale price of $325,000. The subsidiary holds the land until it sells the land to an unaffiliated company on November 12, 2019. The parent uses the equity method to account for its Equity Investment.

a. Prepare the required [I] consolidation entry in 2012.

Description	Debit	Credit
[lgain]	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer
	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer

b. Prepare the required [I] consolidation entry required at the end of each year 2013 through 2018.

Description	Debit	Credit
[lgain]	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer
	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer

c. Assume that the subsidiary resells the land outside of the consolidated group for $425,000 on November 12, 2019. Prepare the journal entry made by the subsidiary to record the sale and the required [I] consolidation entry for 2019.

Description	Debit	Credit
	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer
	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer
	Land	Answer	Answer
	To record sale of land to an unaffiliated party.
[lgain]	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer
	AnswerAccounts payableAccounts receivableAccumulated depreciationAPICCashCommon stockCost of goods soldDepreciation expenseEquipmentEquity investmentGain on saleLoss on saleGoodwillInventoryLandRetained earningsSales	Answer	Answer

d. What will be the amount of gain reported in the consolidated income statement in 2019?

$