This is a continuation of Problem 8-14. Trial balances for Phan Company and its subsidiary Sato Company on December 31, 2011, are as follows:

Phan Company acquired its investment in Sato Company through open-market purchases of
stock as follows:

Required:
Refer to Problem 8-14. Prepare the consolidated financial statement workpaper for Phan Company and its subsidiary Sato Company on December 31, 2011. Use the equitymethod.

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Phan Sato $ 165,500 758,888 920,000 150,000 1,100,000 350,000 3,444,388 $ 218,000 Current Assets Investment in Sato Company Other Assets Dividends Declared Cost of Goods Sold Other Expenses 672,000 70,000 325,000 125,000 $1,410,000 160,000 400,000 Liabilities Capital Stock, $10 par Paid in Capital 1/1 Retained Earnings Sales Equity Income $159,050 600,000 100,000 650,338 1,800,000 135,000 250,000 600,000 33.47441,381410,000 Sato Company Date Shares Purchased Cost Retained Earnings Balance 110,500 210,000 280,000 600,500 46,000 165,000 250,000 1/1/09 9,000 12,500 14,500 36,000 Total