PROBLEMI 7 - 2 Work paper Journal Entries 2 26 108 Fico Company, a truck manufacturer , Owns 40%6 of the voting stock of Seward Company . ON January 1 , 2011 , Fico Company sold trucks to Seward Company for $350, 000 . The trucks , which represented inventory to Pico Company , had a cost to Fico Company of $ 250.000 . THE Management of Seward Company Estimated that the trucks had a useful life of six wears from the date of purchase . Seward Company uses the straight - line method to depreciate its capital assets . In 2011 , Pico Company reported $ 600, 000 in net income from its independent operations ( including sales to affiliates but Excluding dividend or Equity income from subsidiary ), and Seward Company reported $ 200, 000 in net income from it's operations. Required : A. Prepare in general journal form the work paper Entries necessary because of the intercompany Sales in! ( 1 ) The consolidated financial Statements work paper for the year Ended DECEMBER 31 , 2011 . ( 2) The consolidated financial Statements work; paper for the year ended DECEMBER 31 , 2012 . B. Calculate controlling interest in consolidated net income for the year Ended DECEMBER 3 1 , 2011