Comparative income statements for Pim Corporation and its 100 percent-owned subsidiary, Sad Corporation, for the year ended December 31, 2019, are summarized as follows:

Pim purchased its interest in Sad at fair value equal to book value on January 1, 2011. On January 1, 2012, Pim sold $250,000 par of 10 percent, 10-year bonds to the public at par, and on January 2, 2019, Sad purchased $100,000 par of the bonds at 97. The companies use straight-line amortization. There are no other intercompany transactions between the affiliates.
REQUIRED
Prepare a consolidated income statement for Pim Corporation and Subsidiary for the year ended December 31, 2019.

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Pim Sad $250,000 11,000 (100,000) Sales Income from Sad Bond interest income (includes $500,000 113,000 discount amortization) Cost of sales Operating expenses Bond interest expense (335,000) (75,000) (25,000) $178,000 (50,000) Net income $111,000