Parent Corporation acquired 80% of Subsidiary Companys common stock at January 1, 2017 for $2,800,000. At that date, the fair value of the noncontrolling interest was $700,000. Financial statement data for 2020 are presented below.

	Parent	Subsidiary
Income Statement for the Year Ended December 31, 2020:
Sales	$ 5,204	$ 2,800
Income from Sub	254
Cost of goods sold	(4,160)	(2,020)
Depreciation expense	(300)	(200)
Other expenses	(240)	(180)
Net income	$ 758	$ 400
Retained Earnings Statement for the Year Ended December 31, 2020:
Retained earnings, Jan. 1	$ 3,375	$ 2,150
Net income	758	400
Dividends declared	(500)	(250)
Retained earnings, Dec. 31	$ 3,633	$ 2,300
Balance Sheet, December 31, 2020:
Cash	$ 1,303	$ 100
Accounts receivable	800	700
Inventory	1,700	1,100
Buildings & equipment	6,000	4,000
Accumulated depreciation	(3,100)	(1,200)
Investment in Subsidiary	2,930
Total assets	$ 9,633	$ 4,700
Accounts payable	$ 1,000	$ 152
Bonds payable	3,000	1,000
Bond premium		48
Common Stock	2,000	1,000
Additional paid-in capital		200
Retained earnings	3,633	2,300
Total liabilities & stockholders equity	$ 9,633	$ 4,700

Additional information:

• At the acquisition date, Subs net assets were $3,000,000. The full amount of the excess of fair value over book value is related entirely to buildings and equipment, which had an estimated remaining economic life of 10 years.

• Parent and Sub regularly purchase inventory from each other. Intercompany inventory sales transactions were:

• During 2019, Sub sold inventory costing $400,000 to Parent for $600,000; Parent resold 60% of the inventory in 2019 and 40% in 2020.
• During 2019, Parent sold inventory costing $200,000 to Sub for $260,000; Sub resold 2/3 of the inventory in 2019 and 1/3 in 2020.
• During 2020, Sub sold inventory costing $300,000 to Parent for $450,000; Parent resold 1/3 of the inventory in 2020.
• During 2020, Parent sold inventory costing $90,000 to Sub for $120,000 and Sub continues to hold all of the inventory as of the end of 2020.

• Analysis of receivables and payables showed that Sub owed Parent $100,000 on account at December 31, 2020.

Required:

1. Prepare the 2020 consolidation adjusting and eliminating entries (on the following page).

2. Show the computation to verify Parents Income from Sub balance for 2020.

Income from Sub =