On January 1, Year 4, Handy Company (Handy) purchased 70% of the outstanding common shares of Dandy Limited (Dandy) for $7,000. On that date, Dandy's shareholders' equity consisted of common shares of $360 and retained earnings of $5,600.

The financial statements for Handy and Dandy for Year 9 were as follows:

Balance Sheet At December 31, Year 9 Cash$1,450$890Accounts receivable2,9101,160Inventory3,5103,030Property, plant, and equipmentnet4,4503,120Investment in Dandy7,000Total$19,320$8,200Current liabilities$4,470$300Long-term liabilities3,2101,340Common shares1,110360Retained earnings10,5306,200Total$19,320$8,200

Statement of income and retained earnings for year ended december 31, year 9 Handy Dandy

Sales$22,450$7,990Cost of sales15,0203,500Gross profit7,4304,490Other revenue1,730Selling and administrative expenses(950(530)Other expenses(5,430)(2,150)Income before income taxes2,7801,810Income tax expense1,000750Net income1,7801,060Retained earnings, beginning of year10,5306,030Dividends paid(1,780)(890)Retained earnings, end of year$10,530$6,200

• In negotiating the purchase price at the date of acquisition, it was agreed that the fair values of all of Dandy's assets and liabilities were equal to their carrying amounts, except for the following:

Inventory : carrying amount 2,210 Fair value 2,310

Equipment: carrying amount 2,610 Fair value 3,110

• Both companies use FIFO to account for their inventory and the straight-line method for amortizing their property, plant, and equipment. Dandy's equipment had a remaining useful life of 10 years at the acquisition date.
• Goodwill is not amortized on a systematic basis. However, each year, goodwill is evaluated to determine if there has been a permanent impairment. It was determined that goodwill on the consolidated balance sheet should be reported at its recoverable amount of $1,210 on December 31, Year 8, and $1,060 on December 31, Year 9.
• During Year 9, inventory sales from Dandy to Handy were $5,000. Handy's inventories contained merchandise purchased from Dandy for $2,500 at December 31, Year 8, and $3,600 at December 31, Year 9. Dandy earns a gross margin of 50% on its intercompany sales.
• On January 1, Year 5, Handy sold some equipment to Dandy for $2,100 and recorded a gain of $280 before taxes. This equipment had a remaining useful life of eight years at the time of the purchase by Dandy.
• Handy charges $50 per month to Dandy for consulting services and has been doing so throughout Years 8 and 9.
• Handy uses the cost method of accounting for its long-term investment.
• Both companies pay taxes at the rate of 40%.
• Amortization expense is grouped with selling and administrative expenses, and impairment losses are grouped with other expenses.

Please create a consolidated statement of income for the year ended December 31, Year 9