Prince Corporation holds 75 percent of the common stock of Sword Distributors Inc., purchased on December 31, 20X1, for $2,160,000. At the date of acquisition, Sword reported common stock with a par value of $920,000, additional paid-in capital of $1,270,000, and retained earnings of $520,000. The fair value of the noncontrolling interest at acquisition was $720,000. The differential at acquisition was attributable to the following items an Goodwi1l Total Differen! Inventory (sold in 20X2) 42,500 59, 500 68,000 $170,000 During 20X2, Prince sold a plot of land that it had purchased several years before to Sword at a gain of $23,800; Sword continues to hold the land. In 20X6, Prince and Sword entered into a five-year contract under which Prince provides management consulting services to Sword on a continuing basis; Sword pays Prince a fixed fee of $81,000 per year for these services. At December 31, 20X8, Sword owed Prince $20,250 as the final 20X8 quarterly payment under the contract On January 2, 20X8, Prince paid $260,000 to Sword to purchase equipment that Sword was then carrying at $300,000. Sword had purchased that equipment on December 27, 20X2, for $450,000. The equipment is expected to have a total 15-year life and no salvage value. The amount of the differential assigned to goodwill has not been impaired At December 31, 20X8, trial balances for Prince and Sword appeared as follows Prince Corporation Debit Sword Distributors Inc Credit Debit Credit Cash Current Receivables Inventory Investment in Sword Distributors Land Buildings & Equipment 63,700 106, 800 302,000 2, 839, 325 415,000 2,590,000 $51,000 94,400 227,900 1,200, 000 3,050,000 Prince Corporation holds 75 percent of the common stock of Sword Distributors Inc., purchased on December 31, 20X1, for $2,160,000. At the date of acquisition, Sword reported common stock with a par value of $920,000, additional paid-in capital of $1,270,000, and retained earnings of $520,000. The fair value of the noncontrolling interest at acquisition was $720,000. The differential at acquisition was attributable to the following items an Goodwi1l Total Differen! Inventory (sold in 20X2) 42,500 59, 500 68,000 $170,000 During 20X2, Prince sold a plot of land that it had purchased several years before to Sword at a gain of $23,800; Sword continues to hold the land. In 20X6, Prince and Sword entered into a five-year contract under which Prince provides management consulting services to Sword on a continuing basis; Sword pays Prince a fixed fee of $81,000 per year for these services. At December 31, 20X8, Sword owed Prince $20,250 as the final 20X8 quarterly payment under the contract On January 2, 20X8, Prince paid $260,000 to Sword to purchase equipment that Sword was then carrying at $300,000. Sword had purchased that equipment on December 27, 20X2, for $450,000. The equipment is expected to have a total 15-year life and no salvage value. The amount of the differential assigned to goodwill has not been impaired At December 31, 20X8, trial balances for Prince and Sword appeared as follows Prince Corporation Debit Sword Distributors Inc Credit Debit Credit Cash Current Receivables Inventory Investment in Sword Distributors Land Buildings & Equipment 63,700 106, 800 302,000 2, 839, 325 415,000 2,590,000 $51,000 94,400 227,900 1,200, 000 3,050,000