Choco Company (subsidiary), a 85% owned subsidiary of Allie Corporation (parent), sells inventory to Allie (upstream) at a 20% profit on selling price. The following data are available pertaining to intra-entity purchases. Choco was acquired on January 1, 2015. Allie purchased inventory from Choco for $9,000 and at the end of 2015, Allie still have $2,200 inventory.

Assume the equity method is used. During 2015, Choco had net income of $120,000 and paid dividends of $15,000.

a. Compute the equity in earnings of Choco reported on Allie's books for 2015.

b. Compute the non-controlling interest in Choco's net income for 2015.