A 1 2 3 4 5 6 7 8 9 10 B C D E F G H On January 1, 20X2, Wire Corporation purchased 90 percent of Power Company common shares and 60 percent of its preferred shares at underlying book value. At that date, the fair value of the noncontrolling interest in Power's common stock was equal to 10 percent of the book value of its common stock. Power's balance sheet at the time of purchase contained the following balances: Total Assets Total Liabilities Preferred Stock Common Stock Retained Earnings Total Liabilities and Equity 860000 80000 100000 300000 380000 860000 1 The preferred shares, which are cumulative with regard to dividends, have a 12 percent annual dividend rate and are five years in arrears on January 1, 20X2. All of the $10 par value preferred shares are 11 callable at $12 per share after December 31, 20X0. During 20X2, Power reported net income of $70,000 and paid no dividends. A B T Required. 14 a. Compute Power's contribution to consolidated net income for 20X2. 15 Note: Use cell A2 to A12 from the given information to complete this question. 16 17 Power's contribution to consolidated net income for 20X2 18 19 b. 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 D E F G Compute the amount of income to be assigned to the noncontrolling interest in the 20X2 consolidated income statement. Note: Use cell A2 to A12 from the given information to complete this question. Net income Less preferred dividends Preferred stock Preferred dividend rate Preferred dividends Net income allocated to common shareholders Noncontolling interest percentage of common shares Income assigned to noncontrolling interest common shareholders Income assigned to noncontrolling interest preferred shareholders Preferred dividends Noncontrolling interest percentage of preferred shares Income assigned to noncontrolling interest preferred shareholders Total income assigned to noncopntrolling interest B D C Compute the portion of Power's retained earnings assignable to its preferred shareholders on January 1, 20X2. Note: Use cell A2 to A12 from the given information to complete this question. Dividiends in arrears Preferred stock at par value Preferred dividend rate Annual preferred dividends A 36 C. 37 38 39 40 41 42 43 44 Total dividends in arrears 45 Call feature 46 Call price 47 48 49 50 51 Years in arrears 52 53 d. 54 55 56 57 58 59 60 Par value Call value per share Shares outstanding Call feature Total retained earnings assigned to preferred stock Compute the book value assigned to the common shareholders on January 1, 20X2. Note: Use cell A2 to A12 from the given information to complete this question. Par value of common shares outstanding Total retained earnings balance Retained earnings assigned to preferred shares Retained earnings balance assigned to common shares Book value of common shares E F G H 62 e. 63 64 65 66 67 68 69 70 71 72 73 74 75 Compute the amount to be reported as the noncontrolling interest in the consolidated balance sheet on January 1, 20X2. Note: Use cell A2 to A12 from the given information to complete this question. Book value of common shares Noncontrolling interest percentage Noncontrolling interest in common shares Par value of preferred shares Retained earnings assigned to preferred shares Book value assigned to preferred shares Noncontrolling percentage interest in preferred shares Noncontrolling interest in preferred shares Total noncontrolling interest