Set out below are the draft income statements of P and its subsidiary S for the year ended 31 December 20X7.

On the 1 January 20X6 P purchased 75% of the ordinary shares in S.

During the year S sold goods to P for $20,000, making a mark up of one third. Only 20% of these goods were sold before the end of the year, the rest were still in inventory.

P values non-controlling interest using the fair value method.

Prepare the consolidated income statement for the year ended 31 December 20X7

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