On January 1, 2009, Nichols Company acquired 80% of Smith Company's common stock and 40% of its non-voting, cumulative preferred stock. The consideration transferred by Nichols was $1,200,000 for the common and $124,000 for the preferred. Any excess acquisition-date fair value over book value is considered goodwill. The capital structure of Smith immediately prior to the acquisition is:

If Smith's net income is $100,000 in the year following the acquistion, what is the non-controlling portion of smith's income? PLEASE SHOW ALL WORK!

Common stock, $10 par value (50,000 shares outstanding) Preferred stock, 6% cumulative, S100 par value, 3,000 shares outstanding Additional paid in capital Retained earnings Total stockholders' equity $500,000 300,000 200,000 500.000 $1,500,000