$---$

$**$PARENTO INC.$**$

$**$CONSOLIDATED BALANCE SHEET$**$

At December $31,$ Year $4$

$|$ Item $|$ Year $4|$ Year $3|$

$|--------------------------|--------------|--------------|$

$|$ Cash $|$ $$83,790|$ $$51,800|$

$|$ Accounts receivable $|$ $$140,000|$ $$152,600|$

$|$ Inventory $|$ $$293,000|$ $$198,500|$

$|$ Land $|$ $$103,500|$ $$163,000|$

$|$ Buildings and equipment $|$ $$712,000|$ $$520,000|$

$|$ Accumulated depreciation $|$ $$(215,820)|$ $$(174,720)|$

$|$ Databases $|$ $$22,300|$ $$25,500|$

$|**$Total Assets$**|**$$$1,138,770**|**$$$936,680**|$

$|$ Liabilities & Equity $|$ Year $4|$ Year $3|$

$|---------------------------|--------------|--------------|$

$|$ Accounts payable $|$ $$121,200|$ $$96,480|$

$|$ Accrued liabilities $|$ $$34,500|$ $$33,200|$

$|$ Bonds payable $|$ $$260,000|$ $$200,000|$

$|$ Bond premium $|$ $$8,320|$ $$9,000|$

$|$ Common shares $|$ $$180,000|$ $$180,000|$

$|$ Retained earnings $|$ $$507,390|$ $$394,000|$

$|$ Non$-$controlling interest $|$ $$27,360|$ $$24,000|$

$|**$Total Liabilities & Equity$**|**$$$1,138,770**|**$$$936,680**|$

$---$

$**$PARENTO INC.$**$

$**$CONSOLIDATED INCOME STATEMENT$**$

For the Year Ended December $31,$ Year $4$

$|$ Item $|$ Year $4|$

$|--------------------------|--------------|$

$|$ Sales $|$ $$1,163,000|$

$|$ Cost of sales $|$ $$(581,500)|$

$|$ Selling expense $|$ $$(174,450)|$

$|$ Administrative expense $|$ $$(181,000)|$

$|$ Interest expense $|$ $$(47,800)|$

$|$ Income tax $|$ $$(42,500)|$

$|**$Total Expenses$**|**$$$(1,027,250)**|$

$|**$Net income$**|**$$$135,750**|$

$|$ Attributable to: $||$

$|$ Parento$$s shareholders $|$ $$130,390|$

$|$ Non$-$controlling interest $|$ $$5,360|$

$---$

$**$Additional Information:$**$

$-**$Parento Inc.$**$ purchased its $**80\%$ interest$**$ in $**$Santana Corp.$**$ on $**$January $1,$ Year $2**,$ for $**$$$122,000**$ when Santana had $**$net assets of $$90,000**.$

$-$ The $**$acquisition differential$**$ was allocated $**$$$32,000$ to databases$**(10-$year life$),$ with the balance to $**$equipment$**(20-$year life$).$

$-$ Parento issued $**$$$60,000$ in bonds$**$ on $**$December $31,$ Year $4**.$

$-**$Santana$$s Year $4**$ net income was $**$$$30,000**,$ and it paid $**$$$10,000$ in dividends$**.$

$**$Selling and administrative expenses include:$**$

$|$ Item $|$ Amount $|$

$|------------------------------|----------|$

$|$ Depreciation of buildings and equipment $|$ $$41,100|$

$|$ Database amortization $|$ $$3,200|$

$|$ Loss on land sale $|$ $$6,000|$

Parento reported a $**$Year $4$ equity method income of $$130,390**$ and paid $**$dividends of $$17,000**.$

$---$

$**$Required:$**$

$($a$)$ Prepare a $**$consolidated cash flow statement$**$ for $**$Year $4**.$