Stage Company operates on a calendar-year basis, reporting its results of operations quarterly. For the first quarter of 20X1, Stage reported sales of $244,000 and operating expenses of $184,000 and paid dividends of $13,000. On April 1, 20X1, Parachute Theaters Inc. acquired 85 percent of Stages common stock for $765,000. At that date, the fair value of the noncontrolling interest was $135,000, and Stage had 100,000 outstanding shares of $1 par common stock, originally issued at $6 per share. The differential is related to goodwill. On December 31, 20X1, the management of Parachute Theaters reviewed the amount attributed to goodwill as a result of its purchase of Stage common stock and concluded that goodwill was not impaired. Stages retained earnings statement for the full year 20X1 appears as follows:

Retained Earnings, January 1, 20X1	$	141,000
Net Income		166,000
Dividends		(35,000	)
Retained Earnings, December 31, 20X1	$	272,000

Parachute Theaters accounts for its investment in Stage using the equity method. Required: a. Present all entries that Parachute Theaters would have recorded in accounting for its investment in Stage during 20X1. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

• A

  Record the purchase of Stage Company stock.

• B

  Record the equity-method income.

• C

  Record the dividends from Stage Company.

• b. Present all consolidation entries needed in a worksheet to prepare a complete set of consolidated financial statements for the year 20X1.

• A

  Record the preacquisition income and dividends consolidation entry.

• B

  Record the basic consolidation entry.

• C

  Record the excess value (differential) reclassification entry.