Pioneer Corporation purchased 80 percent of Lowe Corporation’s stock on January 1, 20X2. At that date, Lowe reported retained earnings of $80,000 and had $120,000 of stock outstanding. The fair value of its buildings was $32,000 more than the book value. Pioneer paid $190,000 to acquire the Lowe shares. At that date, the noncontrolling interest had a fair value of $47,500. The remaining economic life for all Lowe’s depreciable assets was eight years on the date of combination. The amount of the differential assigned to goodwill is not impaired. Lowe reported net income of $40,000 in 20X2 and declared no dividends.

Required

a. Give the elimination entries needed to prepare a consolidated balance sheet immediately after Pioneer purchased Lowe stock.

b. Give all elimination entries needed to prepare a full set of consolidated financial statements for 20X2.