McGuire Company acquired 90 percent of Hogan Company on January 1, 20X1, for $243,000 cash. This amount is reflective of Hogan's total fair value. Hogan's stockholders' equity consisted of common stock of $160,000 and retained earnings of $80,000. An analysis of Hogan's net assets revealed the following:

	Book Value	Fair Value
Buildings, 10-year life	$10,000	$9,000
Equipment, 4-year life	14,000	18,000
Land	5,000	12,000

Any excess consideration transferred over fair value is attributable to an unrecorded patent with a useful life of 5 years. At what amount will the Patent be reported in the December 31, 20X1, balance sheet?

a.)$20,000

b.) $30,000

c.) $10,000

d.) $16,000

On January 1, 20X1, Ashley Inc. pays $350,000 for 70% of Marea Co.'s outstanding common stock in a purchase transaction. Marea reported common stock on that date of $250,000 with retained earnings of $100,000. Equipment, which had a ten-year remaining life, was undervalued in Marea's financial records by $70,000.

During the first year, Marea reported net income of $40,000 and paid dividends of $15,000.

What amount should be reported as Noncontrolling Interest in Marea Co. on the consolidated balance sheet as of December 31, 20X1?

a.) $150,000

b.) $162,000

c.) $166,500

d.) $157,500

e.) $155,400

Posito acquired 90% of Gargiulo on January 1, 20X1. There were no excess amortizations associated with this acquisition. G sells inventory to P at a 25% gross profit margin calculated on selling price. The following data are available pertaining to intra-entity purchases:

	20X1	20X2	20X3
Purchases by Posito from Gargiulo	$8.000	$12,000	$15,000
Ending Inventory on Posito's Books	1,200	4,000	3,000

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

	20X1	20X2	20X3
Gargiulo's Net Income	$70,000	$85,000	$94,000
Dividends Paid by Gargiulo	10,000	10,000	15,000

Compute the non-controlling interest in Gargiulo's net income for 20X2. There were no excess amortizations associated with the acquisition.

a.) $8,500.

b.) $8,570.

c.) $8,430.

d.) $8,400.

e.) $7,580.

On January 1, 20X1, Pride, Inc. acquired 80% of the outstanding voting common stock of Strong Corp. for $364,000. On this date, equipment (with a five-year life) was undervalued on Strong's books by $35,000. Any remaining excess was attributable to goodwill. As of December 31, 20X1, the financial statements appeared as follows:

	Pride		Strong
Revenues	$420,000		$280,000
Cost of Goods Sold	196,000		112,000
Operating Expenses	28,000		14,000
Investment Income	100,800
Net Income	$296,800		$154,000
Retained Earnings, 1/1/20X1	$420,000		$210,000
Net Income (From Above)	296,800		154,000
Dividends	0		0
Retained Earnings, 12/31/20X1	$716,800		$364,000
Cash and Receivables	$294,000		$126,000
Inventory	210,000		154,000
Investment in Strong	464,800
Equipment (net)	616,000		420,000
Total Assets	$1,584,800		$700,000
Liabilities	$588,000		$196,000
Common Stock	280,000		140,000
Retained Earnings, 12/31/20X1	716,800		364,000
Total Liabilities and Equity	$1,584,800		$700,000

During 20X1, Pride bought inventory for $112,000 and sold it to Strong for $140,000; 60% of these goods were unsold on December 31, 20X1. Only half of this purchase had been paid for by Strong by the end of the year.

What is the total of consolidated cost of goods sold?

a.) $196,000.

b.) $212,800.

c.) $184,800.

d.) $203,000.

e.) $168,000.

Presented below are several figures reported for Post Inc. and Mitchell Co. as of December 31, 20X2:

	Post	Mitchell
Inventory	$200,000	$100,000
Sales	450,000	250,000
Cost of Goods Sold	250,000	190,000
Expenses	90,000	50,000

Post Inc. acquired 80% of Mitchell Co.'s outstanding common stock on January 1, 20X1. The entire difference between the amount paid and the fair value of Mitchell's net assets is attributed to a previously unrecorded patent with a fair value of $112,500. The patent is being amortized over 20 years. During 20X1, Mitchell sold Post inventory costing $60,000 for $70,000. 30% of this inventory was not sold to external parties until the following year. During the second year, Mitchell sold inventory costing $90,000 to Post for $115,000. Of this inventory, 25% remained unsold on December 31, 20X2.

What is the noncontrolling interest's share of Mitchell Co.'s net income for 20X2?

a.) $2,000

b.) $1,125

c.) $225

d.) $2,650

e.) $750

Presented below are several figures reported for Post Inc. and Mitchell Co. as of December 31, 20X2:

	Post	Mitchell
Inventory	$200,000	$100,000
Sales	450,000	250,000
Cost of Goods Sold	250,000	190,000
Expenses	90,000	50,000

Post Inc. acquired 80% of Mitchell Co.'s outstanding common stock on January 1, 20X1. The entire difference between the amount paid and the fair value of Mitchell's net assets is attributed to a previously unrecorded patent with a fair value of $112,500. The patent is being amortized over 20 years. During 20X1, Mitchell sold Post inventory costing $60,000 for $70,000. 30% of this inventory was not sold to external parties until the following year. During the second year, Mitchell sold inventory costing $90,000 to Post for $115,000. Of this inventory, 25% remained unsold on December 31, 20X2.

What amount should be reported for consolidated Expenses for 20X2? This is intended to be just for the single account Expenses and does not include Cost of Goods Sold.

a.) $140,000

b.) $134,375

c.) $132,964

d.) $90,000

e.) $145,625