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Prepare the consolidated income statement and starement of retained earnings workpaper for the year ended december 31, 2019. On January 1, 2018, PPP Company purchased

Prepare the consolidated income statement and starement of retained earnings workpaper for the year ended december 31, 2019. image text in transcribed
On January 1, 2018, PPP Company purchased 80% of SSS Company for $960,000. At that time SSS had capital stock outstanding of $400,000 and retained earnings of $400,000. The book value and the value implied are equal with exception of plant and equipment. At the end of 2018, PPP Company had in its ending inventory $54,000 of merchandise it had purchased from SSS Company during the year. SSS Company sold the merchandise at 20% above cost. During 2019, PPP Company sold merchandise to SSS Company for $300,000 at a markup of 20% of the selling price. At December 31, 2019, SSS still had merchandise that it purchased from PPP Company for $78,000 in its inventory. Financial data for 2019 are presented here: PPP Company SSS Company Sales $1,385,000 $720,000 Equity in Subsidiary Income 153,600 Total Revenue 1538,600 720,000 Cost of Goods Sold: Beginning Inventory 210,000 155,000 Purchases 875,000 360,000 Cost of Goods Available 1,085,000 $15,000 Less: Ending Inventory 400,000 225,000 Cost of Goods Sold 685,000 290,000 Other Expense 225.000 216,000 Total Cost and Expense 910,000 506,000 Net Income S628,600 S214,000 1/1 Retained Earnings 1.419,500 450,000 Net Income 628,600 216,000 Dividends Declared (40,000) (30,000) 31/12 Retained Earnings $2.008.100 5634,000 90.000 65,000 Account Receivables 297,000 85,000 Inventory 400,000 225,000 Investment in SSS Company 1,138,000 Plant and Equipment (net) 880,000 540,000 Other Assets 384.0000 230,000 Total Assets $3,189,000 S1,145,000 Account Payable 24,300 25,000 Other Current Liabilities 95,000 86,000 Common Stock 1,061,600 400,000 Retained Earnings 2,008,100 634,000 Total Liabilities and Equity $3,189,000 S1,145,000 Required:Prepare the consolidated statements workpaper for the year ended December 31, 2019. Cash

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