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I need help with sections c & d: c . Compute Subsidence's 2 0 7 reported net income. Net income d . Compute Plate's 2
I need help with sections c & d: c Compute Subsidence's reported net income.
Net income
d Compute Plate's income from its own separate operations, excluding any investment income from its investment in
Subsidence Mining.
Income from separate operations
In its consolidated income statement, Plate Development Company reported consolidated net income of $ and $
of income assigned to the percent noncontrolling interest in its only subsidiary, Subsidence Mining Incorporated During the year,
Subsidence had sold a previously mined parcel of land to Plate for a new housing development; the sales price to Plate was
$ and the land had a carrying amount at the time of sale of $ At the beginning of the previous year, Plate had sold
excavation and grading equipment to Subsidence for $; the equipment had a remaining life of years as of the date of sale
and a book value of $ The equipment originally had cost $ when Plate purchased it on January X The
equipment never was expected to have any salvage value.
Plate had acquired percent of the voting shares of Subsidence eight years earlier when the fair value of its net assets was
$ higher than book value, and the fair value of the noncontrolling interest was $ more than a proportionate share of
the book value of Subsidence's net assets. All the excess over the book value was attributable to intangible assets with a remaining
life of years from the date of combination. Both parent and subsidiary use straightline amortization and depreciation. Assume Plate
uses the fully adjusted equity method.
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