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The comparative consolidated income statements of a parent and its 75%-owned subsidiary were prepared incorrectly as at December 31 and are shown in the table given below. The following items were overlooked when the statements were prepared: The Year 5 gain on sale of assets resulted from the subsidiary selling equipment to the parent on September 30. The parent immediately leased the equipment back to the subsidiary at an annual rental of $25,200. This was the only intercompany rent transaction that occurred each year. The equipment had a remaining life of five years on the date of the intercompany sale. The Year 6 gain on sale of assets resulted from the January 1 sale of a building, with a remaining life of seven years, by the subsidiary to the parent. Both gains were taxed at a rate of 40%. a CONSOLIDATED INCOME STATEMENTS Year 5 Miscellaneous revenues $ 805,000 Gain on sale of assets 16,800 Rental revenue 6.300 Year 6 $ 880,000 49,700 828,100 Miscellaneous expenses Rental expense Depreciation expense Income tax expense Non-controlling interest 408,600 60,400 86,000 86,500 38,000 679,500 $ 148,600 25, 200 954,900 494,540 67,600 88,400 100,000 6,480 757,020 $ 197,880 Net income Required: Prepare correct consolidated income statements for Years 5 and 6. (Input all values as positive numbers. Leave no cells blank - be certain to enter zero wherever required. Omit $ sign in your response.) Year 6 $ Parent Company Corrected Consolidated Income Statements Years 5 and 6 Year 5 Miscellaneous revenues $ Miscellaneous expense Rent expense Depreciation expense Income tax expense Consolidated net income $ Attributable to: Shareholders of Parent $ NCI $ $ $

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