A summary of the separate income of Pod Corporation and the net income of its 75 percent-owned subsidiary, Sev Corporation, for 2011 is as follows:

Sev Corporation sold machinery with a book value of $40,000 to Pod Corporation for $65,000 on January 2, 2009. At the time of the intercompany sale, the machinery had a remaining useful life of five years. Pod uses straight-line depreciation. Pod used the machinery until December 28, 2011, when it was sold to another entity for $36,000.REQUIRED: Prepare a consolidated income statement for Pod Corporation and Subsidiary for2011.

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Sev Pod $500,000 10,000 (200,000) (50.000) (80,000) Sales Gain on sale of machinery Cost of good sold Depreciation expense Other expenses Separate income (excludes investment income) $300,000 (130,000) (30.000) (40,000) $100.000 $180,000