B- The income statement of Penton Corporation showed a net income of $1,400,000 for the year ended December 31, 2020, before recording any income from its 75% owned subsidiary; Salgado. The income statement of Salgado for 2020 showed a net income of $280,000. During 2020, an intercompany sale of welding machine resulted in a gain of $14,000, and the machine was assumed to have a four-year remaining useful life with no residual value. The machine is depreciated on a Straight-line basis.

Required:

1. Calculate Penton's consolidated net income for 20209, and controlling share of consolidated net income for 2020, assuming it was a downstream sale,

2. Calculate Penton's consolidated net income for 2020, and controlling share of consolidated net income for 2020, assuming it was an upstream sale

3. Comment on the results, to indicate the difference between downstream sale and upstream sale.

(16.2 Marks)