P Corporation acquired 80% of the outstanding voting stock of S Corporation when the fair values equaled the book values.

P Corporation acquired 80% of the outstanding voting stock of S Corporation when the fair values equaled the book values.
On July 1, 2020, P sold land to S for $300,000. The land originally cost P $200,000. S recently resold the land on October 30, 2021 for $350,000.
On October 1, 2021, S Corporation sold equipment to P Corporation for $80,000. S originally paid $100,000 for this equipment and had accumulated depreciation of $40,000 thus far. The equipment has a five-year remaining lifeA. Complete the consolidated income statement for P Corporation and subsidiary for the year ended December 31, 2021.

  P S Elimination Entries

Dr. Cr.

Noncontrolling Interest Consolidated Balances
Sales 1,200,000 600,000        
Dividend Income from S 80,000          
Gain on Sale of

Equipment

  20,000        
Gain on Sale of Land   50,000        
Cost of Sales (800,000) (300,000)        
Depreciation Expense (160,000) (80,000)        
Other Expenses (200,000) (160,000)        
Noncontrolling Interest

in Income

           
Net Income 120,000 130,000        

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