Consolidated Balance Sheet Thompson Company spent $240,000 to acquire all of Lake...

Consolidated Balance Sheet

Thompson Company spent $240,000 to acquire all of Lake Corporation’s stock on January 1, 20X2. The balance sheets of the two companies on December 31, 20X3, showed the following amounts:

Lake reported retained earnings of $100,000 at the date of acquisition. The difference between the acquisition price and underlying book value is assigned to buildings and equipment with a remaining economic life of 10 years from the date of acquisition. Assume Lake’s accumulated depreciation on the acquisition date was $25,000.

Required

a. Give the appropriate elimination entry or entries needed to prepare a consolidated balance sheet as of December 31, 20X3.

b. Prepare a consolidated balance sheet worksheet as of December 31, 20X3.