Punk Corporation purchased 90 percent of Soul Company's voting common shares on January 1, 20X2, at underlying book value. At that date, the fair value of the noncontrolling interest was equal to 10 percent of the book value of Soul Company. Punk also purchased $82,000 of 6 percent, five-year bonds directly from Soul on January 1, 20X2, for $86,000. The bonds pay interest annually on December 31. The trial balances of the companies as of December 31, 20X4, are as follows: Note: Assume using straight-line amortization of bond discount or premium. Punk Corporation Soul Company Item Debit Credit Debit Credit Cash and Receivables $ 36,000 $ 50,600 Inventory 179,000 76,000 Buildings and Equipment 408,000 254,000 Investment in Soul Company Stock 119,772 Investment in Soul Company Bonds 83,600 Cost of Goods Sold 73,000 66,800 Depreciation Expense 19,000 14,000 Interest Expense 14,920 4,120 Dividends Declared 29,000 19,000 Accumulated Depreciation $ 123,000 $ 63,000 Current Payables 115,300 100,920 Bonds Payable 182,000 82,000 Bond Premium 1,600 Common Stock 105,000 65,000 Retained Earnings 234,000 35,000 Sales 152,000 137,000 Interest Income 4,120 Income from Soul Company Stock 46,872 Total $ 962,292 $ 962,292 $ 484,520 $ 484,520 PUNK CORPORATION AND SUBSIDIARY Consolidated Financial Statement Worksheet December 31, 20X4 Punk Soul Consolidation Entries Corporation Company Consolidated Debit Credit Income Statement Sales 152,000 137,000 289,000 Interest Income 4,120 4,120 0 Less: COGS (73,000) (66,800) (139,800) Less: Depreciation Expense (19,000) (14,000) (33,000) Less: Interest Expenses (14,920) (4,120) 4,120 (14,920) Income from Soul Company Stock 46,872 46,872 Consolidated Net Income 96,072 52,080 4,120 4,120 148,152 NCI in Net Income Controlling Interest in Net Income 96,072 52,080 4,120 4,120 148, 152 Statement of Retained Earnings Beginning Balance Net Income 96,072 52,080 4,120 4,120 148,152 Less: Dividends Declared 29,000) (19,000) (48,000) Ending Balance 67,072 33,080 4,120 4,120 100, 152 Balance Sheet Assets Cash and Accounts Receivable 36,000 50,600 86,600 Inventory 179,000 76,000 255,000 Buildings and Equipment 408,000 254,000 662,000 Less: Accumulated Depreciation (123,000) (63,000) (186,000) Investment in Soul Company Bonds 83,600 83,600 Investment in Soul Company Stock 119,772 119,772 Total Assets 703,372 317,600 0 1,020,972 Liabilities and Equity Current Payable 115,300 100,920 216,220 Bonds Payable 182,000 82,000 264,000 Bond Premium 1,600 1,600 Common Stock 105,000 65,000 170,000 Retained Earnings 67,072 33,080 4,120 4,120 100, 152 NCI in Net Assets of Soul Company Total Liabilities and Equity 469,372 282,600 4,120 4,120 751,972