P4-10 Workpapers (year of acquisition, fair value/book value differentials, intercompany balances) Pop Corporation acquired 80 percent of Son Corporations common stock on January 12016for $420,000 cash. The stockholders' equity of Son at this time consisted of $300,000 capital stock and $100,000 retained earnings. The difference between the fair value of Son and the underlying equity acquired in Son was due to a $25,000 undervaluation of Son's inventorya \$50,000 undervaluation of Son's equipment, and goodwill. The undervalued inventory was sold by Son during 2016, and the undervalued equipment had a remaining useful life of five years. Straight-line depreciation is used. Son owed Pop $8,000 on accounts payable at December 31, 2016. The separate financial statements of Pop and Son Corporations at and for the year ended Decem ber 31, 2016, are as follows (in thousands) Pop Son Combined Income and Retained Earnings Statements for the Year Ended December 31 Sales $ 400 $220 Income from Son 36 Cost of sales(160) (80 ) Depreciation expense(80) (40) Other expenses (51) (20)/80 ) Net income 145 Add: Retained earnings January 1150100 Deduct: Dividends (80(40) Retained earnings December 31$ 215 $140 Balance Sheet at December 31 Cash $ 59 60 Trade receivables-net 5680 Dividends receivable Inventories 8060 Land30 Buildingsnet130140 Equipment-net 400 200 Investment in Son 424 Total assets $ 1,195$600 Accounts payable$ 80 $100 Dividends payable 20020 Other liabilities100 Capital stock, $10 par 600300 Retained earnings 215 140 Total equities $1,195 $600 16 60 40 REQUIRED: Prepare consolidation workpapers for Pop Corporation and Son at and for the year ended December 312016.?