I am stuck on this problem. I am in ACC485 at Grand Canyon University. I copied all the information down below. I need help understanding how to arrive at the answers. I know the general journal form to utilize, but unsure how to get to the answer. I also need help with requirement B because I do not know how to get the information to even answer that question.

PROBLEM 6-4 Upstream and Downstream Sales LO2 LO5

Pace Company owns 85% of the outstanding common stock of Sand Company and all the outstanding common stock of Star Company. During 2015, the affiliates engaged in intercompany sales as follows:

Sales of Merchandise

Pace to Sand$40,000

Sand to Pace60,000

Sand to Star 75,000

Star to Pace50,000

$225,000

The following amounts of intercompany profits were included in the December 31, 2014, and December 31, 2015, inventories of the individual companies:

Intercompany Profit in December 31, 2014, Inventory of

Selling CompanyPaceSandStarTotal

Pace Company$7,000 $7,000

Sand Company$5,000$3,0008,000

Star Company8,000 8,000

Total $13,000$7,000$3,000 $23,000

Intercompany Profit in December 31, 2015, Inventory of

Selling Company Pace Sand Star Total

Pace Company $2,000 $2,000

Sand Company$6,000$9,00015,000

Star Company4,0004,000

Total$10,000$2,000 $9,000$21,000

Income from each company's independent operations (including sales to affiliates) for the year

ended December 31, 2015, is presented here:

Pace Company$200,000

Sand Company150,000

Star Company125,000

Required:

A. Prepare in general journal form the workpaper entries necessary to eliminate intercompany sales and inter-company profit in the December 31, 2015, consolidated financial statements workpaper.

B. Calculate the balance to be reported in the consolidated income statement for the following line items:

Consolidated income

Noncontrolling interest in consolidated income

Controlling interest in consolidated income