Spartan Corp, owned 80% of the voting common stock of Olympic Co. In reviewing the

accounts, you identified the following intra-company transactions took place.

(1) In 2021, Olympic sold a parcel of land to Spartan. The land had a book value of $82,000

and was sold to Spartan for $145,000.

(2) In 2020 Spartan sold merchandise costing $ 1 50,000 to Olympic for $200,000. 40% of the

merchandise were not used or sold to outsiders as of December 31, 2020.

(3) On January 1, 2021, Olympic sold equipment to Spartan for $168,000 in cash. The

equipment originally cost $140,000 but had a book value of only $98,000 when

transferred. On that date, the equipment had a five-year remaining life. Depreciation

expense was calculated using the straight-line method and assuming zero salvage value.

Olympic's reported net income for 2021 was $119,000.