NEED 6-5

need 6-5

Controlling Interest, Downstream Sales Lo 2 On January 1, 2019. Pearce Company purchased an 80% interest in the capital stock of Searl Company for $2,460,000. At that time, Searl Company had capital stock of $1,$00,000 and retained earnings of $300,000. The difference between book of value Searl equity and the value implied by the purchase price was attributed to specific assets of Searl Company as follows: At year-end 2019 and 2020. Searl had in its inventory merchandise that it had purchased from Pearce at a 25% markup on cost during each year in the following amounts: During 2019. Pearce reported net income from independent operations (including sales to affiliates) of $1,500,000, while Searle reported net income of $600,000. In 2020. Pearce's net income from independent operations (including sales to affiliates) was $1,800,000 and Searl's was 5750,000. Required: Calculate the controlling interest in consolidated net income for 2019 and 2020. Controlling Interest, Upstream Sales LO 2 Refer to Exereise 6-4. Using the same figures, assume that the merchandise mentioned was included in Pearce's imventory, having been purchased from Searl. Required: Calculate the controlling interest in consolidated net income for 2019 and 2020