Eliminations and Adjustments: (CV) Convert to simple equity method as of January 1, 20X9 (90% of $50,000 increase in Sub’s retained earnings from January 1, 20X8 to January 1, 20X9). (CY) Eliminate Parent’s dividend income against dividends declared by Subsidiary. (EL) Eliminate 90% of the Subsidiary Company equity balances at the beginning of the year against the investment account. (D) Distribute the $150,000 excess of cost over book value to goodwill; allocate to Parent and NCI. (B1) Eliminate $3,000 of intercompany interest receivable and payable. (B2) Eliminate all of the intercompany interest income and expense. Eliminate the balances in investment in bonds, bonds payable, and discount on bonds payable. The resulting gain of $900 is the gain as of beginning of year: on January 1, 20X8 $97,300 carrying value of bonds less $96,400 purchase price.