On January 1, 2013, Musial Corp sold equipment to Martin Inc (a wholly-owned subsidiary) for $168,000 in cash. The equipment originally cost $140,000 but had a book value of only $98,000 when transferred. On that date, the equipment had a five year remaining life. Depreciation expense was calculated using the straight-line method.

Musial earned $308,000 in net income in 2013 (not including any investment income) while Matin reported $126,000. Assume there is no amortization related to the original investment.

Required:

1.) Assuming that Musial owned only 90% of Matin, what is consolidated net income for 2013?

2.) Prepare a schedule of consolidated net income and the share to controlling and noncontrolling interests for 2013, assuming that Musial owned only 90% of Matin and the equipment transfer had been upstream.