2.6

Please, provide step by step explanation as well as each calculation for each number you get. Thanks

E2-6 Journal entry to record income from investee with loss from discontinued operations Pam Corporation purchased a 40 percent interest in Sun Corporation for $2,000,000 on January 1, at book value, when Sun's assets and liabilities were recorded at fair values. During the year, Sun reported net income of $1,200,000 as follows (in thousands): Income from continuing operations Less: Loss from discontinued operations Net income $1,400 (200) $1,200 REQUIRED: Prepare the journal entry on Pam's books to recognize income from the investment in Sun for the year