Prime Company holds 60 percent of Lane Companys stock, acquired on January 1, 20X2, for $150,000. On the date of acquisition, Lane reported retained earnings of $58,000 and $130,000 of common stock outstanding, and the fair value of the noncontrolling interest was $100,000. Prime uses the fully adjusted equity method in accounting for its investment in Lane.

Trial balance data for the two companies on December 31, 20X7, are as follows:

	Prime Company							Lane Company
Item	Debit			Credit				Debit			Credit
Cash and Accounts Receivable	$	153,000						$	56,000
Inventory		244,000							104,000
Land		104,000							75,000
Buildings and Equipment		450,000							162,000
Investment in Lane Company Stock		182,700
Cost of Goods Sold		158,000							90,000
Depreciation and Amortization		28,000							20,000
Other Expenses		22,000							11,000
Dividends Declared		56,000							39,000
Accumulated Depreciation				$	178,500						$	47,000
Accounts Payable					50,000							23,000
Bonds Payable					190,000							44,000
Common Stock					280,000							130,000
Retained Earnings					401,000							148,000
Sales					270,000							165,000
Income from Subsidiary					28,200
Total	$	1,397,700		$	1,397,700			$	557,000		$	557,000

Additional Information

1.	At the date of combination, the book values and fair values of Lanes separately identifiable assets and liabilities were equal. The full amount of the increased value of the entity was attributed to goodwill. At December 31, 20X6, the management of Prime reviewed the amount attributed to goodwill as a result of its purchase of Lane stock and recognized an impairment loss of $15,000. No further impairment occurred in 20X7.
2.	On January 1, 20X5, Lane sold land for $6,500 that had cost $17,000 to Prime.
3.	On January 1, 20X6, Prime sold to Lane equipment that it had purchased for $67,200 on January 1, 20X1. The equipment has a total 12-year economic life and was sold to Lane for $51,800. Both companies use straight-line depreciation.
4.	Intercompany receivables and payables total $6,000 on December 31, 20X7.

Required:

a.	Prepare a reconciliation between the balance in Primes Investment in Lane Company Stock account reported on December 31, 20X7, and Lanes book value.

b-1. Prepare all worksheet consolidation entries needed as of December 31, 20X7.