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2. Sidharta is 90%-owned subsidiary of Putra corporation, acquired at book value several years ago. Comparative separate company income statements for these affiliated corporations for
2. Sidharta is 90%-owned subsidiary of Putra corporation, acquired at book value several years ago. Comparative separate company income statements for these affiliated corporations for 2014 are as follows: Putra Corporation Sidharta Corporation Sales $3.000.000 $1.400.000 Income from Sidharta 216.000 Gain on building 60.000 Income credits 3.276.000 1.400.000 Cost of sales 2.000.000 800.000 Operating expenses 600.000 300.000 Income debits 2.600.000 1.100.000 Net income 676.000 $300.000 On January 5, 2014, Putra sold a building with a 10-year remaining useful life to Sidharta at a gain of $60.000. Sidharta paid dividens of $200.000 during 2014. Required: a. Reconstruct the journal entries made by Putra during 2014 to account for its investment in Sidharta. Explanations of the journal entries are required. b. Prepare a consolidated income statement for Putra Corporation and Subsidiary for 2014
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