and please tell me the journal

P5-8 Consolidated workpapers (downstream sales) Pan Corporation acquired 100 percent of Sal Corporation's outstanding voting common stock on Janu ary 1, 2011, for $660,000 cash. Sal's stockholders' equity on this date consisted of $300,000 capital stock and $300,000 retained earnings. The difference between the fair value of Sal and the underi equity acquired in Sal was allocated $30,000 to Sal's undervalued inventory will. The undervalued inventory items were sold by Sal during 2011 ying and the remainder to good Pan made sales of $100,000 to Sal at a gross profit of $40,000 during 201l: during 2012, Pan made sales of $120,000 to Sal at a gross profit of $48,000. One-half the 2011 sales were invento- ried by Sal at year-end 2011, and one-fourth the 2012 sales were inventoried by Sal at year-end 2012. Sal owed Pan $17,000 on account at December 31, 2012 The separate financial statements of Pan and Sal Corporations at and for the year ended December 31, 2012, are summarized as follows: Pan Sal Combined Income and Retained Earnings Statements for the Year Ended December 31, 2012 (in thousands) Sales Income from Sal Cost of sales Depreciation expense Other expenses $ 800 108 (400) (110) (192) 206 606 (100) $ 712 $400 (200) (40) (60) 100 380 (50) $430 Net income Beginning retained earnings Less: Dividends Retained earnings December 31, 2012