Exercise 7-8

On January 1, 2015, P Company acquired a 90% interest in S Company. During 2016, S Company sold merchandise to P Company at 25% above cost in the amount (selling price) of $229,500. At the end of the year, P Company had in its inventory one-third of the amount of goods purchased from S Company.

On January 1, 2016, P Company sold equipment that had a book value of $74,300 to S Company for $126,900. The equipment had an estimated remaining life for four years.

S Company reported net income of $117,300, and P Company reported net income of $276,900 from their independent operations (including sales to affiliates) for the year ended December 31, 2016.

Required:

Calculate controlling interest in consolidated net income for the year ended December 31, 2016.?