Bolt Corporation is 80 percent owned by Allied Foundries Inc. The shares of Bolt were acquired by Allied on January \(1,20 \mathrm{X} 2\), for \(\$ 160,000\). Selected stockholders' equity balances for the companies are as follows:

Allied operates the subsidiary as an independent company and uses the equity method to account for its ownership interest. Operating results for the two enterprises are as follows:

Operating income for Allied Foundries includes all revenue and expenses except for investment income from Bolt Corporation.
\section*{Required}

a. Compute consolidated net income for \(20 \mathrm{X} 4\).

b. Compute consolidated retained earnings as of December 31, 20X4.

c. Compute the amount reported as noncontrolling interest in the consolidated balance sheet on December \(31,20 \mathrm{X} 4\).

d. Prepare a consolidated retained earnings statement for \(20 \mathrm{X} 4\).

Transcribed Image Text:

Allied Foundries Inc. Bolt Corporation Common Stock $400,000 $100,000 Additional Paid-In Capital 150,000 40,000 Retained Earnings, January 1, 20X2 350.000 60,000 Retained Earnings, January 1, 20X4 548.000 130,000 Retained Earnings, December 31, 20X4 642,000 150,000