Prepare consolidated income statement three years after acquisitionComparative income stat...

Prepare consolidated income statement three years after acquisition

Comparative income statements of Pek Corporation and Slo Corporation for the year ended December 31, 2013, are as follows (in thousands):

ADDITIONAL INFORMATION

1. Slo is a 90 percent-owned subsidiary of Pek, acquired by Pek for $1,620,000 on January 1, 2011, when Slo’s stockholders’ equity at book value was $1,400,000.

2. The excess of the cost of Pek’s investment in Slo over book value acquired was allocated $60,000 to undervalued inventories that were sold in 2011, $40,000 to undervalued equipment with a four-year remaining useful life, and the remainder to goodwill.

REQUIRED: Prepare a consolidated income statement for Pek Corporation and Subsidiary for the year ended December 31, 2013.