Prime Corporation acquired 100 percent ownership of Steak Products Company on January 1, 20X1, for $280,000 On that date, Steak reported retained earnings of $82,000 and had $116,000 of common stock outstanding Prime has used the equity method in accounting for its investment in Steak The trial balances for the two companies on December 31, 20X5, appear below Prime CorporationSteak Products CompanyItemDebitCreditDebitCreditCash Receivables$59,000$81,000Inventory276,000106,000Land96,00096,000Buildings Equipment516,000166,000Investment in Steak Products286,200Cost of Goods Sold136,00066,000Depreciation Expense41,00031,000Inventory Losses31,00017,800Dividends Declared46,00026,000Accumulated Depreciation$221,000$137,000Accounts Payable76,00036,000Notes Payable232,00030,800Common Stock316,000116,000Retained Earnings385,200106,000Sales216,000164,000Income from Steak Products41,000$1,487,200$1,487,200$589,800$589,800 Additional Information On the date of combination (five years ago), the fair value of Steak's depreciable assets was $82,000 more than the book value Accumulated depreciation at that date was $10,000 The differential assigned to depreciable assets should be written off over the following 10 year period There was $26,000 of intercorporate receivables and payables at the end of 20X5 Required a Prepare all journal entries that Prime recorded during 20X5 related to its investment in Steak (If no entry is required for a transaction event, select No journal entry required in the first account field ) b Prepare all consolidating entries needed to prepare consolidated statements for 20X5 (If no entry is required for a transaction event, select No journal entry required in the first account field ) c Prepare a three part worksheet as of December 31, 20X5 (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 )

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Prime Corporation acquired 100 percent ownership of Steak Products Company on January 1, 20X1, for $280,000. On that date, Steak reported retained earnings of $82,000

Prime Corporation acquired 100 percent ownership of Steak Products Company on January 1, 20X1, for $280,000. On that date, Steak reported retained earnings of $82,000 and had $116,000 of common stock outstanding. Prime has used the equity-method in accounting for its investment in Steak.

The trial balances for the two companies on December 31, 20X5, appear below.

Prime

CorporationSteak

Products CompanyItemDebitCreditDebitCreditCash & Receivables$59,000$81,000Inventory276,000106,000Land96,00096,000Buildings & Equipment516,000166,000Investment in Steak Products286,200Cost of Goods Sold136,00066,000Depreciation Expense41,00031,000Inventory Losses31,00017,800Dividends Declared46,00026,000Accumulated Depreciation$221,000$137,000Accounts Payable76,00036,000Notes Payable232,00030,800Common Stock316,000116,000Retained Earnings385,200106,000Sales216,000164,000Income from Steak Products41,000$1,487,200$1,487,200$589,800$589,800

Additional Information:

On the date of combination (five years ago), the fair value of Steak's depreciable assets was $82,000 more than the book value. Accumulated depreciation at that date was $10,000. The differential assigned to depreciable assets should be written off over the following 10-year period.
There was $26,000 of intercorporate receivables and payables at the end of 20X5.

Required:

a. Prepare all journal entries that Prime recorded during 20X5 related to its investment in Steak.(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

b. Prepare all consolidating entries needed to prepare consolidated statements for 20X5.(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

c. Prepare a three-part worksheet as of December 31, 20X5.(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.)