Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $183,000 The trial balances for the two companies on December 31, 20X7, included the following amounts Prince Corporation Sword Company Item Debit Credit Debit Credit Cash $ 88,000 $ 27,000 Accounts Receivable 53,000 58,000 Inventory 182,000 120,000 Land 86,000 22,000 Buildings and Equipment 491,000 155,000 Investment in Sword Company 233,000 Cost of Goods Sold 491,000 258,000 Depreciation Expense 21,000 11,000 Other Expenses 62,000 62,000 Dividends Declared 55,000 23,000 Accumulated Depreciation $ 139,000 $ 55,000 Accounts Payable 54,000 30,000 Mortgages Payable 187,000 117,000 Common Stock 286,000 43,000 Retained Earnings 331,000 84,000 Sales 692,000 407,000 Income from Sword Company 73,000 $ 1,762,000 $ 1,762,000 $ 736,000 $ 736,000 Additional Information On January 1, 20X7, Sword reported net assets with a book value of $127,000 A total of $23,000 of the acquisition price is applied to goodwill, which was not impaired in 20X7 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 Prince used the equity method in accounting for its investment in Sword Detailed analysis of receivables and payables showed that Sword owed Prince $25,000 on December 31, 20X7 Additional Information On January 1, 20X7, Sword reported net assets with a book value of $127,000 A total of $23,000 of the acquisition price is applied to goodwill, which was not impaired in 20X7 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 Prince used the equity method in accounting for its investment in Sword Detailed analysis of receivables and payables showed that Sword owed Prince $25,000 on December 31, 20X7 Required a Prepare all journal entries recorded by Prince with regard to its investment in Sword during 20X7 (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 a full set of consolidated financial statements for 20X7 (If no entry is required for a transaction event, select No journal entry required in the first account field )

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Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $183,000. The trial balances for the two companies on December 31, 20X7,

Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $183,000. The trial balances for the two companies on December 31, 20X7, included the following amounts:

	Prince Corporation						Sword Company
Item	Debit			Credit			Debit			Credit
Cash		$	88,000					$	27,000
Accounts Receivable			53,000						58,000
Inventory			182,000						120,000
Land			86,000						22,000
Buildings and Equipment			491,000						155,000
Investment in Sword Company			233,000
Cost of Goods Sold			491,000						258,000
Depreciation Expense			21,000						11,000
Other Expenses			62,000						62,000
Dividends Declared			55,000						23,000
Accumulated Depreciation					$	139,000					$	55,000
Accounts Payable						54,000						30,000
Mortgages Payable						187,000						117,000
Common Stock						286,000						43,000
Retained Earnings						331,000						84,000
Sales						692,000						407,000
Income from Sword Company						73,000
		$	1,762,000		$	1,762,000		$	736,000		$	736,000
Additional Information On January 1, 20X7, Sword reported net assets with a book value of $127,000. A total of $23,000 of the acquisition price is applied to goodwill, which was not impaired in 20X7. 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. Prince used the equity-method in accounting for its investment in Sword. Detailed analysis of receivables and payables showed that Sword owed Prince $25,000 on December 31, 20X7. Additional Information On January 1, 20X7, Sword reported net assets with a book value of $127,000. A total of $23,000 of the acquisition price is applied to goodwill, which was not impaired in 20X7. 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. Prince used the equity-method in accounting for its investment in Sword. Detailed analysis of receivables and payables showed that Sword owed Prince $25,000 on December 31, 20X7. Required: a. Prepare all journal entries recorded by Prince with regard to its investment in Sword during 20X7. (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 a full set of consolidated financial statements for 20X7. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)