The accounts of Pyle Company and its subsidiary, Stern Company, are summarized below as of December 31, 2024:

Pyle Company made the following open- market purchase and sale of Stern Company common stock: January 2, 2022, purchased 51,000 shares, cost $510,000; April 1, 2024, sold 3,000 shares, proceeds, $100,000. The book value of Stern Company’s net assets on January 2, 2022, $600,000, (including retained earnings of $120,000) approximated the fair value of those net assets. Subsequent changes in book value of the net assets are entirely attributable to earnings of Stern Company. Stern Company earns its income evenly throughout the year.

Required:
Prepare a consolidated financial statements workpaper as of December 31, 2024. Begin the income statement section of the workpaper with “Net Income Before Dividend Income” which is $172,000 and $186,000 for Pyle Company and Stern Company, respectively.

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Debits Current Assets Investment in Stern Company Other Assets Dividends Declared, 11/1 Credits Liabilities Common Stock, $5 par Other Contributed Capital 1/1 Retained Earnings Net Income Pyle $600,000 469,075 1,180,000 80,000 $2,329,075 $ 190,000 500,000 219,075 1,200,000 220,000 $2,329,075 Stern $320,000 668,000 60,000 $1,048,000 $ 90,000 300,000 180,000 292,000 186,000 $1,048,000