PCO owns a 90% interest in S Co, purchased at a time when the book values of S recorded assets and liabilities were equal to fair values. During 2014, S sold merchandise to P cost 32,000 for $40,000. At December 31, 2014, 75% of this merchandise is still in P inventory. Separate incomes for P&S are summarized as follows: P s $900,000 Sales $200,000 400,000 Cost of sales 100,000 500,000 Gross profit 100,000 200,000 Operating expenses 80,000 Separate income $300,000 $ 20,000 What is amount of Income from S reported in P income statement? Select one: a. 16,000 b. 16,200 c. 12,000 d. 12,600