Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $187,000. The trial balances for the two companies on December 31, 20X7, included the following amounts:

	Prime	Corp	Sword	Company
	Debit	Credit	Debit	Credit
Cash	88,000		36,000
Accounts Receivable	64,000		69,000
Inventory	174,000		115,000
Land	86,000		31,000
Buildings and Equipment	495,000		167,000
Investment in Sword Company	241,000
Cost of Goods Sold	495,000			254,000
Depreciation Expense	23,000			13,000
Other Expenses	56,000			56.000
Dividends Declared	50,000			24,000
Accumulated Depreciation		152,000		65,000
Accountants Payable		65,000		30,000
Mortgages Payable		188,000		136,000
Common Stock		283,000		50,000
Retained Earnings		309,000		80,000
Sales		697000		404,000
Income from Sword Company		78,000
	1,772,000	1,772,000	765,000	765,000

Additional Information:

1. On January 1, 20X7, Sword reported net assets with a book value of $130,000. A total of $24,000 of the acquisition price is applied to goodwill, which was not impaired in 20X7.

2. Swords depreciable assets had an estimated economic life of 11 years on the date of combination. The difference between fair value and book value of tangible assets is related entirely to buildings and equipment.

3. Prince used the equity-method in accounting for its investment in Sword.

4.Detailed analysis of receivables and payables showed that Sword owed Prince $25,000 on December 31, 20X7.

Part B: b. Prepare all consolidating entries needed to prepare a full set of consolidated financial statements for 20X7

A). Record the basic consolidation entry.

B). Record the amortized excess value reclassification entry.

C). Record the excess value (differential) reclassification entry.

D). Record the entry to eliminate the intercompany accounts.

E). Record the optional accumulated depreciation consolidation entry.