Empire Co. Ltd. is a chain of grocery outlets. Empire owns 100% of Foodland Ltd., a competing chain that Empire established to serve a different market segment. To obtain the best deal from suppliers, Empire buys most of the materials and products for both chains and resells to Foodland whatever that chain needs.

During 20X6, Empire sold materials costing $2,000,000 to Foodland at cost. At the end of the year, Foodland still owed Empire $250,000 for purchases of the materials.

Empire records its investment in Foodland on the equity basis. During 20X6, Foodland declared and paid dividends totaling $200,000. Empire has not yet recorded its equity in the earnings of Foodland for 20X6. The pre-consolidation trial balances for the two companies are shown below.

Required:

Prepare a consolidated SFP and SCI for Empire Co. Ltd. for 20X6. Also show the elimination journal entries required.

Cash Accounts receivable Inventory Fixtures and equipment (net) Investment in Class Glass Ltd. Other investments Accounts payable Common shares Retained earnings Dividends paid Sales Cost of goods sold Other operating expenses Dividend and interest income Total Trial Balances Dr (Cr) Empire Class $ 400,000 50,000 300,000 150,000 1,200,000 600,000 5,000,000 1,400,000 2,100,000 500,000 (700,000) (500,000) (1,600,000) (1,000,000) (5,700,000) (1,300,000) 600,000 200,000 (16,000,000) (7,100,000) 11,000,000 5,000,000 3,000,000 2,500,000 (100,000) $ $