Punk Corporation purchased 80 percent of Soul Corporations stock on January 1, 20X2. At that date, Soul reported retained earnings of $80,000 and had $120,000 of stock outstanding. The fair value of its buildings was $32,000 more than the book value.

Punk paid $190,000 to acquire the Soul shares. At that date, the noncontrolling interest had a fair value of $47,500. The remaining economic life for all Souls depreciable assets was eight years on the date of combination. The amount of the differential assigned to goodwill is not impaired. Soul reported net income of $40,000 in 20X2 and declared no dividends.

Required:

1. Prepare the consolidation entries needed to prepare a consolidated balance sheet immediately after Punk purchased Soul stock.

Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

a. Record the basic consolidation entry.

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

2. Prepare all consolidation entries needed to prepare a full set of consolidated financial statements for 20X2.

a. Record the basic consolidation entry.

b. Record the amortized excess value reclassification entry.

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