4.3

PLEASE, PROVIDE THE ANSWER AND DETAILED EXPLANATION.

. 1. Pam Corporation owns a 70 percent interest in Sun Corporation, acquired several years ago at book value. On December 31, 2016, Sun mailed a check for $80,000 to Pam in part payment of an $160,000 account with Pam. Pam had not received the check when the books were closed on December 31. Pam had accounts receivable of $1,200,000 (including the $160,000 from Sun), and Sun had accounts receivable of $1,760,000 at year-end. In the consolidated balance sheet of Pam Corporation and Subsidiary at December 31, 2016, accounts receivable will be shown at what amount? Use the following information in answering questions 2 and 3. Pam Corporation purchased a 70 percent interest in Sun Corporation on January 1, 2016, for $112,000, when Sun's stockholders' equity consisted of $24,000 common stock, $80,000 additional paid-in capital, and $16,000 retained earnings. Income and dividend information for Sun is as follows: 2016 2017 2018 Net income (or loss) $8,000 $1,600 $14,000) Dividends 3,200 800 2. Pam reported income of $96,000 for 2018. This does not include income from Sun. What is consolidated net income for 2018? . 3. What is Pam's Investment in Sun balance at December 31, 2018, under the equity method