On January 1, 2004, Pre Corporation acquired 60 percent of the voting common shares of Sue Corporation at an excess of fair value over book value of $1,000,000. This excess was attributed to plant assets with a remaining useful life of five years. For the year ended December 31, 2011, Sue prepared condensed financial statements as follows (in thousands):

Sue regularly sells inventory items to Pre at a price of 120 percent of cost. In 2010 and 2011, sales from Sue to Pre are as follows:

1. Under the equity method, Pre reports investment income from Sue for 2011 of:a. $120b. $96c. $80d. $104 loss2. Noncontrolling interest on December 31, 2011, is:a. $2,200b. $2,184c. $2,176d. $2,1403. On the books of Pre Corporation, the investment account is properly reflected on December 31, 2011, at:a. $3,240b. $3,264c. $3,276d. Not enough information isgiven.

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Condensed Balance Sheet at December 31, 2011 Current assets (except inventory) Inventories Plant assets-net $ 600 300 5,000 $5,900 Total assets $ 400 Liabilities Capital stock Retained earnings Total equities Condensed Statement of Income and Retained Earnings Sales Cost of sales 3,400 2.100 $5.900 $1,000 (500) Other expenses Net income (300) 200 Add: Retained earnings January 1, 2011 Less: Dividends 2,000 100 Retained earnings December 31, 2011 $2,100