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Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $196,000. The trial balances for the two companies on December 31, 20X7, included the following amounts: Sword Company Debit Credit $ 32,000 63,80 112,000 27,000 166,000 Item Cash Accounts Receivable Inventory Land Buildings and Equipment Investment in Sword Company Cost of Goods Sold Depreciation Expense other Expenses Dividends Declared Accumulated Depreciation Accounts Payable Mortgages Payable Common Stock Retained Earnings Sales Income from Sword Company Prince Corporation Debit Credit $ 85,000 58,000 171,000 83,000 490,000 260,000 490,000 21,000 58,000 58,000 $ 138,000 59,000 195,000 288,000 320,000 681,000 93,000 $1,774,000 $1,774,000 252,200 11,000 58,000 29,000 $ 55,000 31,000 113,000 44,000 90,000 417,000 $750,000 $750,000 Additional Information 1. On January 1, 20X7, Sword reported net assets with a book value of $134,000. A total of $29,000 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 $26,000 on December 31, 20X7. 2. transaction/event, select "No journal entry required" in the first account field.) Answer is not complete. No Event General Journal Debit Credit 25 points A 1 Investment in Sword Company 171,000 x Cash 171,000 B 2 93,000 X Investment in Sword Company Income from Sword Company 93,000 3 Cash 29,000 Investment in Sword Company > 29,000 D 4 Income from Sword Company Investment in Sword Company 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