Taxable incomes for Pub Corporation and Sew Corporation, its 70 percent-owned subsidiary, for

2011 are as follows (in thousands):

ADDITIONAL INFORMATION1. Pub acquired its interest in Sew at a fair value equal to book value on December 31, 2010.2. Sew paid dividends of $40,000 in 2011.3. Pub sold $90,000 in merchandise to Sew during 2011, and there was $10,000 in unrealized profit from the sales at year end.4. A flat 34% income tax rate is applicable.5. Pub is eligible for the 80% dividends-received deduction.REQUIRED:Prepare a consolidation income statement workpaper for Pub Corporation and Subsidiary for 2011.

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Pub Sew $500 $300 Sales Dividends received from Sew 28 Total revenue 528 300 Cost of sales 250 78 120 80 Operating expenses Total deductions 328 200 $200 Taxable income $100