$2.$ Mr$.$ Cord owns four corporations. Combined financial statements are being prepared for these corporations, which have intercompany loans of $$200,000$ and intercompany profits of $$500,000.$ What amount of these intercompany loans and profits should be included in the combined financial statements?

Multiple Choice

Intercompany Loan $=$ $$200,000$; Intercompany Profits $=$ $$0$

Intercompany Loan $=$ $$0$; Intercompany Profits $=$ $$500,000$

Intercompany Loan $=$ $$200,000$; Intercompany Profits $=$ $$500,000$

Intercompany Loan $=$ $$0$; Intercompany Profits $=$ $$0$ Problem $3-20($Static$)$ Determining Net Income of Parent Company LO $3-4$

Potter Corporation and its subsidiary reported consolidated net income of $$164,300$ for $20$X$2.$ Potter owns $60$ percent of the common shares of its subsidiary, acquired at book value. Noncontrolling interest was assigned income of $$15,200$ in the consolidated income statement for $20$X$2.$

Required:

Determine the amount of separate operating income reported by Potter for $20$X$2.$ Problem $3-24($Static$)$ Parent Company and Consolidated Balances LO $3-4$

Sheet Company reported the following net income and dividends for the years indicated:

Year Net Income Dividends

$20$X$5$ $ $35,000$ $ $12,000$

$20$X$645,00020,000$

$20$X$730,00014,000$

Pillow Corporation acquired $75$ percent of Sheet$$s common stock on January $1,20$X$5.$ On that date, the fair value of Sheet$$s net assets was equal to the book value. Pillow uses the equity method in accounting for its ownership in Sheet and reported a balance of $$259,800$ in its investment account on December $31,20$X$7.$

Required:

What amount did Pillow pay when it purchased Sheet$$s shares?

What was the fair value of Sheet$$s net assets on January $1,20$X$5?$

What amount was assigned to the NCI shareholders on January $1,20$X$5?$

What amount will be assigned to the NCI shareholders in the consolidated balance sheet prepared at December $31,20$X$7?$