Livingston Company is a wholly-owned subsidiary of Rose Corporation. Livingston operates in a foreign country with financial statements recorded in pounds (P), the company's functional currency. Financial statements for the year 2024 are as follows: Sales Income Statement For Year Ending December 31, 2024 Cost of goods sold Gross profit Less: Operating expenses P 270,000 (155,000) 115,000 (54,000) 10,000 Gain on sale of equipment Net income Statement of Retained Earnings P 71,000 For Year Ending December 31, 2024 Retained earnings, 1/1/24 Net income Less: Dividends Retained earnings, 12/31/24 P 216,000 71,000 (26,000) P 261,000 Balance Sheet December 31, 2024 Assets Cash Receivables Inventory Property, plant, and equipment (net) Total assets Liabilities and Equities Liabilities Common stock Retained earnings, 12/31/24 Total liabilities and equities Additional Information P 44,000 116,000 58,000 339,000 P 557,000 P 176,000 120,000 261,000 P 557,000 ⚫ The common stock was issued in 2017 when the exchange rate was $2.08 per pound; property, plant, and equipment was acquired in 2018 when the exchange rate was $2.00 per pound. As of January 1, 2024, the retained earnings balance was translated as $396,520. The U.S. dollar-per-pound exchange rates for 2024 follow: January 1 April 1 September 1 December 31 Weighted average $ 1.67 1.61 1.72 1.54 1.59 Inventory was acquired evenly throughout the year. •The December 31, 2023, balance sheet reported a translation adjustment with a debit balance of $85,000. • Dividends were declared on April 1, 2024, and a piece of equipment was sold on September 1, 2024. Required: Assume that the pound is Livingston Company's functional currency. Translate the 2024 foreign currency financial statements into the parent's reporting currency, the U.S. dollar. 1a. Prepare an Income Statement. 1b. Prepare a Statement of Retained Earnings. 1c. Prepare a Balance Sheet. Complete this question by entering your answers in the tabs below. Income Statement Retained Earnings Balance Sheet Prepare an Income Statement. Note: Amounts to be deducted and negative amounts should be indicated with a minus sign. LIVINGSTON COMPANY Income Statement For the Year Ending December 31, 2024