Paulee Corporation paid $24,800 for an 8o% interest in Sergio Corporation on January 1, 2015, at which time Sergio's stockholders' equity consisted of $15,000 of Common Stock and $6,000 of Retained Earnings. The fair values of Sergio Corporation's assets and liabilities were identical to recorded book values when Paulee acquired its 80% interest. Sergio Corporation reported net income of $4,000 and paid dividends of $2,000 during 2015 Paulee Corporation sold inventory items to Sergio during 2015 and 2016 as follows: 2016 2015 $6,000 $5,000 Paulee's sales to Sergio 3,500 Paulee's cost of sales to Sergio 3,000 1,500 1,000 Unrealized profit at year-end At December 31, 2016, the accounts payable of Sergio include $1,500 owed to Paulee for inventory purchases. Financial statements of Paulee and Sergio appear in the first two columns of the partially completed working papers Required: 1. Show all preliminary computations (5 points) 2. Complete the consolidation working papers for Paulee Corporation and Subsidiary for the year ended December 31, 2016 (13 points) 3. Give all eliminating journal entries (6 points)