P Co acquired an 80% interest in S Co on1/1/2014, when the book values of S assets and liabilities were equal to their fair values.The cost of the 80% interest was equal to 80% of the book value of S net assets. During 2014,P sold merchandise that cost $86,000 to S for $70,000. On 31/12/ 2014, three-fourths of the merchandise acquired from P remained in S inventory. Separate incomes (investment income not included) of the two companies are as follows:

P S

Sales Revenue 180,000 160,000

Cost of Goods Sold 120,000 90,000

Operating Expenses 17,000 21,000

Separate incomes 43,000 49,000

What is P income from S for 2014?

Select one:

a. $39,200

b. $49,000

c. $ 51,200

d. $29,600