Intercompany Transactions, Equity Method Income and Noncontrolling Interest in Net Income Putnam Company owns 80 percent of Swaraj Company. The excess of acquisition cost over book value was attributed entirely to previously unrecorded identifiable intangibles. For 2020, Swaraj Company reported net income of $7,000,000 and declared and paid dividends of $2,000,000. Appropriate amortization of the previously unrecorded identifiable intangibles for 2020 is $1,750,000. The following information is available regarding intercompany transactions: 1. During 2020, Swaraj sold land to Putnam at a loss of $300,000. Putnam still holds the land at December 31, 2020. 2. Putnam's ending inventory at December 31, 2020, included merchandise acquired from Swaraj; the unconfirmed profit on this inventory was $600,000. 3. Putnam's ending inventory at December 31, 2019, included merchandise acquired from Swaraj; the unconfirmed profit was $350,000. 4. On January 3, 2017, Putnam sold equipment to Swaraj at a gain of $1,000,000; at the time of sale, the remaining life of this equipment was 10 years, straight-line. Swaraj still holds the equipment at December 31, 2020. Required a. Calculate Putnam Company's equity in net income for 2020 and the noncontrolling interest in net income for 2020. Enter answers using all zeros (do not abbreviate answer to millions or thousands). December 31, 2020 Putnam Company's equity in net income $ 4,240,000 x Noncontrolling interest in net income $ 1,060,000 b. Prepare the working paper eliminations made in consolidation at December 31, 2020, related to the intercompany transactions. Enter answers using all zeros (do not abbreviate answer to millions or thousands). Description Land Loss on sale of land To eliminate the unconfirmed loss on land sale. Cost of goods sold Inventory Debit 300,000 Credit 0 0 300,000 600,000 0 0 600,000 Retained earnings-Swaraj To eliminate the unconfirmed profit in ending inventory. Cost of goods sold 350,000 0 0 350,000 To recognize the confirmed profit in beginning inventory. Equipment, net 1,000,000 0 0 1,000,000 * Equipment, net To eliminate the unconfirmed profit on equipment sales. Retained earnings-Swaraj Depreciation expense To eliminate intercompany profit from depreciation expense. 100,000 0 0 100,000