Question: The trial balance data presented in Problem 6-35 can be converted to reflect use of the cost method by inserting the following amounts in place

The trial balance data presented in Problem 6-35 can be converted to reflect use of the cost method by inserting the following amounts in place of those presented for Prime Company:

Investment in Lane Company Stock $160,000 Retained Earnings 348,000 Income from Subsidiary

\section*{Required}

a. Prepare the journal entries that would have been recorded on the books of Prime Company during $20 \times 7$ under the cost method.

b. Prepare all eliminating entries needed to complete a consolidation workpaper as of December 31, 20X7, assuming Prime has used the cost method.

c. Complete a three-part consolidation workpaper as of December 31, $20 \times 7$.

Investment in Lane Company Stock $160,000 Retained Earnings 348,000 Income from Subsidiary Dividend Income -0- 28.000

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