Assignment 1:

On January 1, 2013, Daisy Company acquired 90 percent of Rose Company for $700,000 in cash. Roses total book value on that date was $620,000 and the fair value of the noncontrollinginterest was $150,500. The newly acquired subsidiary possessed a trademark (10-year remaining life) that, although unrecorded on Roses accounting records, had a fair value of $75,000. Any remaining excess acquisition-date fair value was attributed to goodwill.

Daisy decided to acquire Rose so that the subsidiary could furnish component parts for the parents production process. During the ensuing years, Rose sold inventory to Daisy as follows:

	Cost to Rose company	Transfer price	Inventory still Held at End of Year (at transfer price)
2013	70,000	100,000	20,000
2014	100,000	85,000	40,000
2015	115,000	100,000	50,000

Any transferred merchandise that Daisy retained at a year-end was always put into production during the following period.

Rose company earned net income during 2015 of 80,000 and distributed dividends of 25,000.

1.Compute annual amortization

2.Compute the balance of investment in Rose account

3.Compute controlling interest share of net income 2015

4. 3.Compute non controlling interest share of net income 2015

5.Record necessary journal entries during 2015 related to intra company transactions.