Persaud Ltd. acquired 100% of the voting shares of Singh Ltd. on January 1, 20X6, for $ 1,255,000. The financial statement of Singh Ltd. on the date of acquisition was as follows:

The inventory will be sold and the accounts receivable collected within seven months, and the depreciable capital assets will be depreciated over 10 years, straight- line, with no salvage value. During 20X6, Singh Ltd. sold inventory to Persaud Ltd. for $ 150,000 with a 20% markup on retail. At the end of 20X6, $ 30,000 (at retail) of these goods was still in the inventory. Persaud Ltd. sold $ 200,000 of goods to Singh Ltd. during 20X6, with a 25% markup on retail, and $ 40,000 (at retail) of these were still in inventory at the end of 20X6. All of these goods remaining in inventory were sold during 20X7. During 20X7, Persaud Ltd. sold $ 180,000 of goods to Singh Ltd. with a 25% markup on retail, and $ 50,000 (at retail) of these goods was in inventory at the end of 20X7. In addition, Singh Ltd. sold goods to Persaud Ltd. for $ 220,000 with a 20% markup on retail, and $ 60,000 (at retail) of these were still in inventory at the end of 20X7. All of these remaining goods were sold during 20X8.
The following are the financial statements of the two companies at December 31, 20X7:

Required
Calculate the following, considering all dates carefully:
1. Investment income, under the equity method, for 20X6.
2. Consolidated net income for 20X7.
3. Consolidated balance of accounts receivable at December 31, 20X7.
4. Consolidated balance of depreciable capital assets at December 31, 20X7.
5. Consolidated balance of inventory at December 31,20X7.

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Singh Ltd. Statement of Financial Position January 1, 20X6 Carrying Fair market value value 40,000 40,000 110,000 280,000 310,000 460,000 Accounts receivable Inventory 130,000 320,000 400,000 495,000 Depreciable capital assets, net Total Current liabilities Common shares Retained earnings Total 1,200,000 250,000 400,000 550,000 250,000 $1,200,000 Statements of Financial Position December 31, 20X7 Persaud Ltd. 55,000 140,000 400,000 670,000 864,000 1,255,000 $3,384,000 248,000 1,136.000 2,000,000 3,384,000 Singh Ltd. 40,000 110,000 320,000 385,000 520,000 Cash Accounts receivable Inventory Depreciable capital assets, net Investment in Singh Ltd. Total Current liabilities Common shares Retained eamings Total 1375,000 180,000 400,000 795,000 1,375,000 Statements of Comprehensive Income Year Ended December 31, 20X7 ales Cost of goods sold Depreciation Other expenses Persaud Ltd 900,000 一一542,000 120,000 128,000 790,000 110,000 Singh Ltd. 845,000 479,000 110,000 126,000 715,000 130,000 Net income Neither company paid dividends during 20X6 or 20x7