Akron, Inc., owns all outstanding stock of Toledo Corporation. Amortization expense of $15,000 per year for patented technology resulted from the original acquisition. For 2021, the companies had the following account balances:

		Akron			Toledo
Sales	$	1,100,000		$	600,000
Cost of goods sold		500,000			400,000
Operating expenses		400,000			220,000
Investment income		Not given			0
Dividends declared		80,000			30,000

Intra-entity sales of $320,000 occurred during 2020 and again in 2021. This merchandise cost $240,000 each year. Of the total transfers, $70,000 was still held on December 31, 2020, with $50,000 unsold on December 31, 2021.

1. For consolidation purposes, does the direction of the transfers (upstream or downstream) affect the balances to be reported here?
2. Prepare a consolidated income statement for the year ending December 31, 2021.