Pin Corporation purchased 960,000 shares of Sit Corporation's common stock (an 80 percent interest) for $21,200,000 on January 1, 2011. The $2,000,000 excess of investment fair value over book value acquired was goodwill.

On January 1, 2013, Sit sold 400,000 previously unissued shares of common stock to the public for $30 per share. Sit's stockholders' equity on January 1, 2011, when Pin acquired its interest, and on January 1, 2013, immediately before and after the issuance of additional shares, was as follows (in thousands):

REQUIRED

1. Calculate the balance of Pin's Investment in Sit account on January 1, 2013, before the additional stock issuance.

2. Determine Pin's percentage interest in Sit on January 1, 2013, immediately after the additional stock issuance.

3. Prepare a journal entry on Pin's books to adjust for the additional share issuance on January 1, 2013, if gain or loss is notrecognized.

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January 1, 2013 January 1, 2013 After Issuance January 1, 2011 $12,000 4,000 8,000 Before Issuance Common stock, S10 par Other paid-in capital Retained earnings $12,000 $16,000 10,000 10,000 $26,000 Total $38.000 $24.000