pharma Corporation acquired 60% of the voting stock of Santos Inc. at an acquisition cost of $210,000 on January 1, 2020. The fair value of the noncontrolling interest was $120,000. Santoss equity at the date of acquisition was as follows:

Common stock $ 10,000

Additional paid-in capital 20,000

Retained earnings 50,000

Total $ 80,000

Santoss identifiable net assets were reported at values approximating fair value except that its inventories were undervalued by $10,000, its plant assets were overvalued by $25,500, and it had previously unreported identifiable intangible assets valued at $85,000. The entire beginning inventories were sold in 2020. The remaining useful life of plant assets and intangible assets was both five years with no salvage value. Santos used straight-line depreciation and amortization. During 2020, Santos had a net income of $48,000 and Other Comprehensive Loss of $5,000. On December 23, 2020, Santos declared and paid $10,000 cash dividend to its shareholders.

Required:

(1) Calculate equity in net income of Santos and non-controlling interest in net income for 2020.

(Note: It is not necessary to make the schedule. Writing out the calculation is sufficient).

(2) Prepare the working paper entries for PayPal Company and subsidiary for the year ended December 31, 2020.