Consolidation After Several Years Using Cost Method

Data for PlanetTwo Communications and its wholly-owned subsidiary, Stage 4 Networks, are given below. PlanetTwo acquired Stage 4 on January 1, 2020. PlanetTwo uses the cost method to report its investment in Stage 4, and its accounting year ends December 31.

(in thousands)

Acquisition cost	$25,000
Stage 4s shareholders equity, January 1, 2020	6,000
Stage 4s total reported net income, 20202023	11,000
Stage 4s total dividends paid, 20202023	4,000
Stage 4s reported net income, 2024	500
Dividends declared and paid by Stage 4, 2024	200
Allocation of excess of cost over book value to identiable net assets, at acquisition date (fair value book value):
Land	800
Buildings (15-year life, straight-line)	(1,500)
Identiable intangibles (4-year life)	2,000
Long-term debt premium (5 years to maturity as of January 1, 2020)	100
Goodwill impairment loss, 20202023	300
Goodwill impairment loss, 2024	0

Required

Note: Provide all answers in thousands.

a. Prepare PlanetTwos journal entry or entries during 2024 to report its investment in Stage 4 Networks, on its own books.

Note: If no entry is required, select "N/A - no debit entry is required" and "N/A - no credit entry is required" as your answers

b. Prepare the working paper eliminating entries necessary to consolidate the accounts of PlanetTwo Communications and Stage 4 Networks at December 31, 2024.