Question 8 Party Company owns 60% of the common stock of Sunny Company. Party Company sells merchandise to Sunny Company at 25% above cost. During 2019 and 2020, such sales amounted to $900,000 and $800,000, respectively. At the end of each year, Sunny Company had in its inventory 20% of the goods purchased from Party Company during that year. Party Company reported net income of $750,000 in each year and did not declare any dividends in any year. Sunny Company reported net income of $200,000 in each year and did not declare any dividends in any year. Hint: This question is similar to questions 6.1.6.2 and 6,3. Required: (a) The double entries necessary on the consolidated financial statements workpaper to eliminate the effects of the Intercompany sales for have been prepared for you. Fill in the blanks with the appropriate amount Answer: (1) To eliminate intercompany sales: Sales Debit Credit 800,000 Credit have been prepared Fill in the blanks with the appropriate amount. Answer: Debit 800,000 (1) To eliminate intercompany sales: Sales Purchases (Cost of Goods Sold) (2) To recognize gross profit in beginning inventory realized in 2020 Beginning Retained Earnings-P 1/1 Inventory (Income Statement) (3) To eliminate unrealized intercompany profit in ending Inventory 12/31 Inventory (Income Statement) Inventory (Balance Sheet) (b) ut the amount of controlling interest in the consolidated income statement for 2020, by filling in the blanks in the following table