Pullman Corporation Acquired a 90% Interest in Sleeter Company for $6,500,000

Essay

Pullman Corporation acquired a 90% interest in Sleeter Company for $6,500,000 on January 1 2016.At that time Sleeter Company had common stock of $4,500,000 and retained earnings of $1,800,000.The balance sheet information available for Sleeter Company on January 1,2016,showed the following:
The equipment had a remaining useful life of ten years.Sleeter Company reported $240,000 of net income in 2016 and declared $60,000 of dividends during the year.
Required:
Prepare the workpaper entries assuming the cost method is used,to eliminate dividends,eliminate the investment account,and to allocate and depreciate the difference between implied and book value for 2016.