Attached is a worksheet containing the financial statements for Parrot for the year ending December 31, 2022; for its two 80%-owned subsidiaries, Sumone and Sumother, on December 31, 2022, and for the year ending December 31, 2022; and the six-month period from June 30 to December 31, 2022, respectively.

Parrot acquired Sumone on January 1, 2019, for $64,000. At that date, Sumones stockholders equity comprised:

Common stock	$20,000
Paid-in capital	$13,000
Retained earnings	$22,000

Sumones inventory (book value $20,000 fair value $25,000) and plant (the book value cost $50,000 less accumulated depreciation $10,000 fair value $55,000) were the only assets that required revaluation at acquisition. The plant had a 10-year remaining useful life from the acquisition date and is still owned. The inventory was sold in 2020. Goodwill, if any, since that date does not require impairment. The value of the noncontrolling interest at the acquisition date was determined to be $15,000.

Parrot acquired Sumother on June 30, 2022, for $94,000 cash. At the acquisition date, the balance sheet of Sumother was as shown in the worksheet provided to you. The only asset of Sumother that had a value different from their book value was the inventory, which had a fair value of $40,000. Half of this inventory was sold by December 31, 2022, and the balance is on hand. Goodwill, if appropriate, is also unimpaired since that date. In this acquisition, the noncontrolling interest was valued at $23,000.

On January 1, 2021, Parrot had sold the plant to Sumone for $120,000. This plant had originally cost Parrot $140,000 and had accumulated depreciation of $40,000 at the date of disposal to Sumone. The plant had a five-year remaining useful life from the date of transfer.

Sumone sells goods to other group members. Inventory sales by Sumone to Parrot in 2022 were $40,000. Of these, $16,000 were unsold on December 31, 2022. There were $20,000 of goods held in Parrots inventory on January 1, 2022, arising from prior-year purchases from Sumone. These were all sold outside the group in the current year. Sumone uses a one-third markup on cost for all sales.

The unpaid inter-entity balance due to Sumone from Parrot included in receivables and payables relating to the inventory sales was $10,000 on December 31, 2022, and $5,000 on December 31, 2021.

In this question, all aspects of taxation may be ignored.

Parrot has used the cost (original value) method to account for its investments in the attached worksheets.

Additional Information: There were no fixed-asset sales in the year. Some new fixed assets were acquired for cash. These will have to be determined by considering the change in the fixed-asset accounts. No new long-term debt was issued by any of the companies. Some long-term debt was repaid. There were no material non-cash transactions.

December 31, 2022
	Year	Year	June - Dec
	Parrot	Sumone	Sumother
Income statement
Revenues	96,000	152,800	121,000
less Cost of Sales	(55,250)	(96,400)	(65,000)
	40,750	56,400	56,000
less Expenses:
Depreciation	(5,500)	(20,000)	(10,000)
Other expenses	(22,650)	(20,400)	(15,200)
	(28,150)	(40,400)	(25,200)
Operating income	12,600	16,000	30,800
Interest expense	(12,000)	(4,000)	(4,000)
Investment income	4,000	-	-
Net income	4,600	12,000	26,800
Retained earnings statement
	Parrot	Sumone	Sumother
Retained earnings start	85,100	70,000	20,000
Net income	4,600	12,000	26,800
less Dividends paid	(10,000)		(5,000)
Retained earnings 12/31	79,700	82,000	41,800
Balance sheet	Parrot	Sumone	Sumother
Cash	26,900	35,000	1,000
Accounts receivable	30,000	40,000	45,800
Inventory	46,000	52,000	70,000
Investments	158,000	-	-
Plant and equipment net	80,000	128,000	160,000
	340,900	255,000	276,800
Accounts payable	57,200	61,000	84,000
Accrued liabilities	30,000	9,000	11,000
Long term debt	120,000	70,000	70,000
Common stock	30,000	20,000	30,000
Paid in capital	24,000	13,000	40,000
Retained earnings	79,700	82,000	41,800
Noncontrolling interest
	340,900	255,000	276,800
	-	-	-

REQUIRED

1. Prepare in good form the consolidated statement of cash flows for the Parrot Group for the year ending December 31, 2022.