Hello,

I have been working on this problem all week. Everything is correct but Part C (all the way at the bottom) consolidated financial statement worksheet. I screenshot the entire document so you could see all the work in case it helps. The areas I am having a hard time with have a little red X next to them.

Could you please help me figure out what I am doing wrong?

Thank you.

b. Prepare all consolidating entries needed to prepare a full set of consolidated financial statements for 20X7. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) x Answer is not complete. No Event Accounts Debit Credit A 1 Common stock 45,000 Retained earnings 97,000 Income from Sword Company 85,000 Dividends declared 26,000 Investment in Sword Company 201,000 B 2 Depreciation expense 3,000 Income from Sword Company 3,000 C 3 Buildings and equipment 33,000 Goodwill 26,000 Accumulated depreciation 3,000 Investment in Sword Company 56,000 D 4 Accounts payable 22,000 Accounts receivable 22,000 E 5 Accumulated depreciation V Buildings and equipmentc. Prepare a three-part consolidation worksheet as of December 31, 20X7. (Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be entered as positive values. For accounts where multiple adjusting entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.) * Answer is not complete. PRINCE CORPORATION AND SUBSIDIARY Consolidated Financial Statements Worksheet December 31, 20X7 Consolidation Entries Prince Corp Sword Co DR CR Consolidated Income Statement Sales $ 681,000 $ 416,000 1,097,000 Less: COGS (494,000) (255,000) 749,000) Less: Depreciation expense 20,000) 10,000) (3,000) (33,000) Less: Other expenses 66,000) 66,000) (132,000) Income from Sword Co. 82,000 (82,000) Net Income S 183,000 85,000 0 S (85,000) 183,000 Statement of Retained Earnings Beginning balance $ 366,000 s 97,000 s 97,000 S 366,000 Net income 183,000 85,000 268,000 Less: Dividends declared 69,000) 26,000) (26,000) x (69,000) Ending Balance $ 480,000 156,000 71,000 0 $ 565,000 Balance Sheet Assets Cash S 94,000 $ 44,000 IS 138,000 Accounts receivable 51,000 56,000 22,000 85,000 Inventory 92,000) x (39,000) x Land (181,000) (114,000) * Buildings & equipment 494,000 154,000 33,000 681,000 Less: Accumulated depreciation (146,000) (50,000) (3,000) (199,000) Investment in Sword Co. 257,000 283,000) Goodwill 26,000 26,000 Total Assets 477,000 s 61,000 S 56,000 $ (261,000) $ 731,000 Liabilities & Equity Accounts payable S 55,000 $ 27,000 $ 22,000 S 60,000 Mortgages payable 197,000 129,000 326,000 Common stock 291,000 45,000 45,000 291,000 Retained earnings 480,000 156,000 71,000 565,000 Total Liabilities & Equity $ 1,023,000 S 357,000 S 138,000 0 1,242,000Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $201,000. The trial balances for the two companies on December 31, 20X7, included the following amounts: Prince Corporation Sword Company Item Debit Credit Debit Credit Cash $ 94,000 $ 44,000 Accounts Receivable 51,000 56,000 Inventory 181,000 114,000 Land 92,000 39,000 Buildings and Equipment 494,000 154,000 Investment in Sword Company 257,000 Cost of Goods Sold 494,000 255,000 Depreciation Expense 20,000 10,000 Other Expenses 66,000 66,000 Dividends Declared 69,000 26,000 Accumulated Depreciation $ 146,000 $ 50,000 Accounts Payable 55,000 27,000 Mortgages Payable 197,000 129,000 Common Stock 291,000 45,000 Retained Earnings 366,000 97,000 Sales $81,000 416,000 Income from Sword Company 82, 000 $1, 818,000 $1, 818,000 $764, 000 $764,000 Additional Information 1. On January 1, 20X7, Sword reported net assets with a book value of $142,000. A total of $26,000 of the acquisition price is applied to goodwill, which was not impaired in 20X7. 2. Sword'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 tangible assets is related entirely to buildings and equipment 3. Prince used the equity-method in accounting for its investment in Sword. 4. Detailed analysis of receivables and payables showed that Sword owed Prince $22,000 on December 31, 20X7. Required: a. Prepare all journal entries recorded by Prince with regard to its investment in Sword during 20X7. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Answer is complete and correct. No Event General Journal Debit Credit A Investment in Sword Company 201,000 Cash 201,000 2 Investment in Sword Company 85,000 Income from Sword Company 85,000 C 3 Cash 26,000 Investment in Sword Company 26,000 D 4 Income from Sword Company 3,000 Investment in Sword Company 3,000