Financial statements for Pop and Son Corporations for 2016 are as follows (in thousands): Pop Son Combined Income and Retained Earnings Statement for the Year Ended December 31, 2016 Sales $420 $260 Income from Son 63.8 Gain on sale of land 20 Depreciation expense (80) (60) Other expenses (220) (120) Net income 183.8 100 Add: Beginning retained earnings 280.8 100 Deduct: Dividends (60) Retained earnings December 31 $ 404.6 $200 Balance Sheet at December 31, 2016 Current assets $ 400 $340 Plant assets 1,100 700

Accumulated depreciation (240) (140) Investment in Son 644.6 Total assets $1,904.6 $900 Current liabilities $ 300 $100 Capital stock 1,200 600 Retained earnings 404.6 200 Total equities $1,904.6 $900 Additional Information Pop acquired an 80 percent interest in Son on January 2, 2014, for $580,000, when Sons stockholders equity consisted of $600,000 capital stock and no retained earnings. The excess of investment fair value over book value of the net assets acquired related 50 percent to undervalued inventories (subsequently sold in 2014) and 50 percent to a patent with a 10-year amortization period. Son sold equipment to Pop for $50,000 on January 1, 2015, at which time the equipment had a book value of $20,000 and a five-year remaining useful life (included in plant assets in the financial statements). During 2016, Son sold land to Pop at a profit of $20,000 (included in plant assets in the financial statements). Pop uses the equity method to accounting for its investment in Son. Required Prepare a consolidation workpaper for Pop Corporation and Subsidiary for the year ended December 31, 2016.