At December 31, 2011, when the fair values of Sam Corporation’s net assets were equal to their book values of $240,000, Pit Corporation acquired an 80 percent interest in Sam for $224,000. One year...

At December 31, 2011, when the fair values of Sam Corporation’s net assets were equal to their book values of $240,000, Pit Corporation acquired an 80 percent interest in Sam for $224,000. One year later, at December 31, 2012, the comparative adjusted trial balances of the two corporations appear as follows (in thousands):





ADDITIONAL INFORMATION: During 2012, Sam Corporation sold inventory items costing $15,000 to Pit for $23,000. Half of these inventory items remain unsold at December 31, 2012.
REQUIRED: Prepare comparative consolidated financial statements for Pit Corporation and Subsidiary at and for the year ended December 31, 2012, under
1. Traditional theory
2. Parent-company theory
3. Entity theory