P3-11 Consolidated balance sheet workpapers (fair value/book value differentials and noncontrolling interest)

Pop Corporation acquired a 70 percent interest in Son Corporation on January 1, 2016, for $2,800,000, when Son’s stockholders’ equity consisted of $2,000,000 capital stock and $1,200,000 retained earnings.

On this date, the book value of Son’s assets and liabilities was equal to the fair value, except for inventories that were undervalued by $80,000 and sold in 2016, and plant assets that were undervalued by $320,000 and had a remaining useful life of eight years from January 1. Son’s net income and dividends for 2016 were $280,000 and $40,000, respectively.

Separate-company balance sheet information for Pop and Son Corporations at December 31, 2016, follows (in thousands):

Pop Son Cash $ 240 $ 80 Accounts receivable—customers 1,760 800 Accounts receivable from Pop — 40 Dividends receivable 28 —

Inventories 2,000 1,280 Land 400 600 Plant assets—net 2,800 1,400 Investment in Son 2,884 —

$10,112 $4,200 Accounts payable—suppliers $ 1,200 $ 320 Accounts payable to Son 40 —

Dividends payable 160 40 Long-term debt 2,400 400 Capital stock 4,000 2,000 Retained earnings 2,312 1,440

$10,112 $4,200 REQuIRED: Prepare consolidated balance sheet workpapers for Pop Corporation and Subsidiary at December 31, 2016.