Mortar Corporation acquired 80 percent ownership of Granite Company on January 1, 20X7, for $173,000. At that date, the fair value of the noncontrolling interest was $43,250. The trial balances for the two companies on December 31, 20X7, included the following amounts:

Additional Information
1. On January 1, 20X7, Granite reported net assets with a book value of $150,000 and a fair value of $191,250.
2. Granite’s depreciable assets had an estimated economic life of 11 years on the date of combination. The difference between fair value and book value of Granite’s net assets is related entirely to buildings and equipment.
3. Mortar used the equity method in accounting for its investment in Granite.
4. Detailed analysis of receivables and payables showed that Granite owed Mortar $16,000 on December 31, 20X7.

Required
a. Give all journal entries recorded by Mortar with regard to its investment in Granite during 20X7.
b. Give all elimination entries needed to prepare a full set of consolidated financial statements for 20X7.
c. Prepare a three-part consolidation worksheet as of December 31,20X7.

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Mort ar Corporation Granite Company Debit Debit 55,000 20,000 item Credit Credit $ 38,000 50,000 240,000 80,000 500,000 202,000 500,000 25,000 75,000 $ 25,000 100,000 150,000 250,000 as Accounts Receivable Inventory Land Buildings & Equipment Investment in Granite Company Stock Cost of Goods Solo Depreciation Expense Other Expenses 15,000 75,000 Mortar Corporation Debit Granite Company Debit 20,000 Credit Item Dividends Declared Accumulated Depreciation Accounts Payable Credit 50,000 rtgages Payable Common Stock Retained Earnings Sales Income from Subsidiary $ 155,000 70,000 200,000 300,000 290,000 700,000 45,000 $ 75,000 35,000 50,000 50,000 100,000 400,000 $1,760,000 $1,760,000 $710,000 $710,000