Par Corporation acquired a 70 percent interest in Sul Corporation's outstanding voting common stock on January 1, 2011, for $980,000 cash. The stockholders' equity (book value) of Sul on this date consisted of $1,000,000 capital stock and $200,000 retained earnings. The differences between the fair value of Sul and the book value of Sul were assigned $10,000 to Sul's undervalued inventory, $28,000 to undervalued buildings, $42,000 to undervalued equipment, and $80,000 to previously unrecorded trademarks. Any remaining excess is goodwill.

The undervalued inventory items were sold during 2011, and the undervalued buildings and equipment had remaining useful lives of seven years and three years, respectively. The trademarks have a 40-year life. Depreciation is straight line.

At December 31, 2011, Sul's accounts payable include $20,000 owed to Par. This $20,000 account payable is due on January 15, 2012. Separate financial statements for Par and Sul for 2011 are summarized as follows (in thousands):

REQUIRED
Prepare consolidation workpapers for Par Corporation and Subsidiary for the year ended December 31, 2011. Use an unamortized excess account.

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Combined Income and Retained Earnings Statements for the Year Ended December 31 Cost of sales Add: Retained earnings January 1 Deduct: Dividends Retained earnings December 31 Balance Sheet at December 31 Dividends receivable Other current assets Buildings-net Dividends payable