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Gargiulo Company, a 90% owned subsidiary of Posito Corporation, sells inventory to Posito at a 25% profit on selling price. The following data are available

Gargiulo Company, a 90% owned subsidiary of Posito Corporation, sells inventory to Posito at a 25% profit on selling price. The following data are available pertaining to intra-entity purchases. Gargiulo was acquired on January 1, 2010.

201020112012
Purchases by Posito$8,000$12,000$15,000
Ending inventory on Posito's books1,2004,0003,000

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

201020112012
Garguilo's Net Income$70,000$85,000$94,000
Dividends paid by Gargiulo10,00010,00015,000

Compute the non-controlling interest in Gargiulo's net income for 2012.

A. $9,400.

B. $9,375.

C. $9,425.

D. $9,325.

E. $8,485.

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