P 3-1 Prepare a consolidated balance sheet at acquisition and compute consolidated net income one year later On December 31, 2011, Pen Corporation purchased 80 percent of the stock of Sut Company at book value. The data reported on their separate balance sheets immediately after the acquisition follow. At December 31, 2011, Pen Corporation owes Sut $20,000 on accounts payable. (All amounts are in thousands.) Pen Sut Assets Cash Accounts receivable Inventories Investment in Sut Equipment-net $ 72 136 224 $ 128 180 572 800 1,520 $3,200 700 $1,132 Liabilities and Stockholders' Equity Accounts payable Common stock, $20 par Retained earnings $ 160 1,840 1,200 $3,200 $ 132 600 400 $1,132 REQUIRED 1. Prepare a consolidated balance sheet for Pen Corporation and Subsidiary at December 31, 2011. 2. Compute consolidated net income for 2012 assuming that Pen Corporation reported separate income of $680,000 and Sut Company reported net income of $360,000. (Separate incomes do not include income from the investment in Sut.)