Topp Manufacturing Company acquired 90 percent of Bussman Corporations outstanding common stock on December 31, 20X1, for $3,244,050. At the date of acquisition, the fair value of the noncontrolling interest was $360,450, and Bussman reported common stock outstanding of $1,451,250, premium on common stock of $481,140, and retained earnings of $972,000. The book values and fair values of Bussmans assets and liabilities were equal, except for land, which was worth $319,140 more than its book value.

On April 1, 20X2, Topp issued at par $540,000 of 8 percent bonds directly to Bussman; interest on the bonds is payable March 31 and September 30. On January 2, 20X3, Topp purchased all of Bussmans outstanding 10-year 14 percent bonds from an unrelated institutional investor at 97. The bonds originally had been issued on January 2, 6 years ago, for 103. Interest on the bonds is payable December 31, and June 30.

Since the date it was acquired by Topp Manufacturing, Bussman has sold inventory on account

to Topp on a regular basis. The amount of such intercompany sales totaled $279,045 in 20X2 and $493,290 in 20X3, including a 42 percent gross profit. All inventory transferred in 20X2 had been sold by December 31, 20X2, except inventory which Topp paid $58,725 and did not resell until January 20X3. All 20X2 inventory transactions on account had been satisfied prior the end of the year. Inventory transferred in 20X3 had been resold at December 31, 20X3, except merchandise for which Topp had paid $112,050. An account balance of $63,450 remained unpaid on 20X3 inventory transactions.

On January 1, 20X2, Bussman sold equipment to Topp for $303,750. Bussman had purchased the equipment for $500,850 on January 1, 20X0, and was depreciating it on a straight-line basis with a 10-year expected life and no anticipated salvage value. The equipments total expected life is unchanged as a result of the intercompany sale.

As of December 31, 20X3, Bussman had declared but not yet paid its fourth-quarter dividend of $10,000. Both Topp and Bussman use straight-line depreciation and amortization, including the amortization of bond discount and premium. On December 31, 20X3, Topps management evaluated the Bussmans asset fair value and determined the fair value of Bussmans net assets was $2,517,750 and the fair value of net assets excluding goodwill was $2,227,500. Any goodwill impairments should be shared proportionately between controlling and noncontrolling interests. Topp uses the basic equity method to account for its investment in Bussman.

Task: Prepare all eliminating entries required to complete a three-part consolidated working paper as of December 31, 20X3.

At December 31, 20X3, trial balance for Topp and Bussman appeared as follows:

	Topp Manufacturing			Bussman Corp
Item	Debit	Credit		Debit	Credit
Cash	57,510			386,573
Current Receivables	197,505			332,822
Inventory	360,450			535,275
Investment in Bussman Stock	3,858,284
Investment in Bussman Bonds	3,299,063
Investment in Topp Bonds				540,000
Land	2,515,725			4,077,027
Building and Equipment	4,407,750			2,722,073
Cost of Goods Sold	4,963,316			1,147,682
Depreciation and Amortization	360,450			400,275
Other Expenses	1,138,928			414,923
Dividends Declared	168,750			492,750
Accumulated Depreciation		2,219,171			1,303,223
Current Payables		140,940			339,529
Bonds Payable		540,000			3,375,000
Premium on Bonds Payable					30,375
Common Stock		2,276,370			1,451,250
Premium on Common Stock		2,207,291			481,140
Retained Earnings		4,085,100			1,022,000
Sales		8,581,140			2,799,225
Other Income		319,144			247,658
Income from Subsidiary		958,574
Total	21,237,729	21,327,729		11,049,399	11,049,399