Smith, Inc., a wholly owned subsidiary of Preston, Inc., issued a 12% common stock dividend. The common stock has a par value of $10, market value of $14, and 50,000 shares outstanding. Additional paid-in capital and retained earnings have balances of $200,000 and $300,000, respectively, before declaration of the stock dividend. Preston, Inc. has a recorded balance for the investment in Smith, Inc. of $1,050,000. The fair market value of the net assets equals the carrying value. Make the elimination entry to account for the consolidation of Preston, Inc. and Smith, Inc.