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Proud Corporation acquired 80 percent of Stergis Companys voting stock on January 1, 20X3, at underlying book value. The fair value of the noncontrolling interest was equal to 20 percent of the book value of Stergis at that date. Assume that the accumulated depreciation on depreciable assets was $56,000 on the acquisition date. Proud uses the equity method in accounting for its ownership of Stergis. On December 31, 20X4, the trial balances of the two companies are as follows:

Prepare a three-part consolidation worksheet as of December 31, 20X4. (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.)

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Proud Corporation Stergis Company Credit Debit Current Assets Depreciable Assets Investment in Stergis Company Stock Depreciation Expense 5 255,000 517,000 134,880 24,000 148,000 55,000 5 170,000 319,000 14,000 89,000 17.400 Dividends Declared Accumulated Depreciation Long-Term Debt Common Stock Retained Earnings Sales Income from Subsidiary 5 192,000 65,000 161.480 181,000 265,000 239,000 30,400 5 84,000 45,000 191.400 89,000 59,000 5 1.133,880 S1.133,880 609,400 609,400

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