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Anderson Company, a 90% owned subsidiary of Philbin Corporation, transfers inventory to Philbin at a 25% gross profit rate. The following data are available pertaining

Anderson Company, a 90% owned subsidiary of Philbin Corporation, transfers inventory to Philbin at a 25% gross profit rate. The following data are available pertaining specifically to Philbin’s intra-entity purchases from Anderson. Anderson was acquired on January 1, 2020.

2020

2021

2022

Purchases by Philbin

$

8,000

$

12,000

$

15,000

Ending inventory on Philbin’s books

1,200

4,000

3,000

Assume the equity method is used. The following data are available pertaining to Anderson’s income and dividends.

2020

2021

2022

Anderson’s net income

$

70,000

$

85,000

$

94,000

Dividends paid by Anderson

10,000

10,000

15,000

Assuming there are no excess amortizations associated with the consolidation, and no other intra-entity asset transfers, compute the net income attributable to the noncontrolling interest of Anderson for 2022.

$9,425.

$9,400.

$8,485.

$9,325.

$9,375.



 

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