E 9-7 Calculation of controlling share, noncontrolling share, and effect on investment The affiliation structure for a group of interrelated companies is diagrammed as follows:

60%

70%

70%

90% 60%

Hachi Company Nana Company Ichi Company San Company Roku Company Kyu Company The investments were acquired at fair value equal to book value in 2016, and there were no unrealized or constructive profits or losses.

Separate incomes and dividends (not including investment income) for the companies for 2016 were:

Separate Income

(Loss) Dividends Ichi $1,000,000 $250,000 Roku 800,000 100,000 San (600,000) —

Kyu 750,000 80,000 Nana (500,000) —

Hachi 700,000 75,000 REQuIRED:

Determine the following:

1. The direct noncontrolling interest share of Hachi’s net income for 2016 2. The direct noncontrolling interest share of Nana’s net income for 2016 3. The total noncontrolling interest share on consolidated income statement for 2016 4. The controlling share of consolidated net income for Ichi and Subsidiaries for 2016 5. The net effect (increase or decrease) of Ichi’s Investment in San account 326 CHAPTER 9