Brolga Corporation paid $26,800 cash for a 70% interest in Dance Company on January 1, 2004, when Dances stockholders equity consisted of $15,000 Capital Stock and $9,000 of Retained Earnings.

Additional information:
1.	The cost-book value differential was allocated to a patent with a 20-year amortization period.
2.	Brolga Corporation sold inventory items that cost $4,000 to Dance for $4,800 during 2004 and one-half of these inventory items remained unsold by Dance on December 31, 2004.
3.	During 2005 Brolga Corporation sold inventory items that cost $5,000 to Dance for $6,000 and 30% of these inventory items remained unsold by Dance on December 31, 2005. Dance Corporation owed Brolga $700 on account at year-end 2005.
4.	Brolga Corporation sold equipment with a 5-year remaining life and a book value of $4,000 to Dance for $5,000 on January 1, 2005. Straight-line depreciation is used.
5.	Brolga and Dance pay annual dividends of $10,000 and $3,000, respectively.
6.	Separate financial statements for Brolga and Dance Corporations appear on partially completed consolidation working papers.
Required:
Complete the working papers to consolidate the financial statements for 2005.

Brolga Corporation and Subsidiary
Consolidation Working Papers
at December 31, 2005
		Brolga	Dance	Eliminations	Non- Cntrl.	Consol- idated
	Debit		Credit
INCOME STATEMENT Sales	$	90,000	$35,000
Income from Dance		2,300
Gain on equipment sale		1,000
Cost of sales		( 40,000)	( 20,000)
Depreciation exp		( 6,000)	( 2,000)
Other Expenses		( 24,500)	( 8,000)
Net income		22,800	5,000
Retained Earnings 1/1		25,000	12,000
Add: Net income		22,800	5,000
Dividends		( 10,000)	( 3,000)
Retained Earnings 12/31	$	37,800	$14,000
BALANCE SHEET Cash		10,350	1,500
Receivables		1,500	2,700
Dividends Rec		1,050
Inventories		12,000	6,000
Equipment-net		41,000	23,500
Investment in Dance		28,200
Patent
TOTAL ASSETS	$	94,100	$33,700
LIAB. & EQUITY Accounts payable		6,300	2,200
Dividend payable			1,500
Other Debt		10,000	1,000
Capital stock		40,000	15,000
Retained Earnings		37,800	14,000
1/1 Noncontrl. Interest
12/31 Noncontrl. Interest
TOTAL LIAB. & EQUITY	$	94,100	$33,700