On January 1, 2024, Packard Company purchased an 80% interest in Sage Company for $600,000. On this date Sage Company had common stock of $150,000 and retained earnings of $400,000. Sage Company’s equipment on the date of Packard Company’s purchase had a book value of $400,000 and a fair value of $600,000. All equipment had an estimated useful life of 10 years on January 2, 2014.

Required:
Prepare the December 31 consolidated financial statements workpaper entries for 2024 and 2025 to allocate and depreciate the difference between book value and the value implied by the purchase price, recording accumulated depreciation as a separate balance.