Chapman Company obtains 100 percent of Abernethy Company’s stock on January 1, 2014. As of that date, Abernethy has the following trial balance:

Debit Credit

Accounts payable $ 55,100 cr

Accounts receivable $ 44,700 dr

Additional paid-in capital 50,000 cr

Buildings (net) (4-year life) 163,000 dr

Cash and short-term investments 83,750 dr

Common stock 250,000cr

Equipment (net) (5-year life) 207,500dr

Inventory 122,000 dr

Land 85,500 dr

Long-term liabilities (mature 12/31/17) 162,500 cr

Retained earnings, 1/1/14 202,150 cr

Supplies 13,300 dr

Totals $ 719,750 $ 719,750

During 2014, Abernethy reported net income of $105,000 while declaring and paying dividends of $13,000. During 2015, Abernethy reported net income of $136,750 while declaring and paying dividends of $36,000.

Assume that Chapman Company acquired Abernethy’s common stock for $605,600 in cash. As of January 1, 2014, Abernethy’s land had a fair value of $101,800, its buildings were valued at $227,400, and its equipment was appraised at $164,500. Chapman uses the equity method for this investment.

Prepare consolidation worksheet entries for December 31, 2014, and December 31, 2015.

1.) Prepare entry S. December 31, 2014

2.) Prepare entry A. December 31, 2014

3.) Prepare entry I December 31, 2014

4.) Prepare entry D December 31, 2014

5.)Prepare entry E December 31, 2014

6.) Prepare entry S December 31, 2014

7.) Prepare entry A December 31, 2014

8.) Prepare entry I December 31, 2014

9.) Prepare entry D December 31, 2014

10.) Prepare entry E December 31, 2014