On January 1, Year 4, Place Inc. acquired an 80 percent interest in Setting Co. for $800,000 cash. At that time, Settings assets and liabilities had carrying amounts equal to fair values, except for the following:

Inventory	Undervalued by $75,000	Turns over 6 times a year
Planet and equipment	Undervalued by $50,000	Remaining useful life: 10 years
Bonds payable	Overvalued by $40,000	Maturity date: December 31, Year 8

The premium/discount on bonds payable is amortized on a straight-line basis. At January 1, Year 4, Setting had 100,000 common shares outstanding with a carrying amount of $550,000 and retained earnings of $50,000. The abbreviated financial statements of Place and Setting on December 31, Year 6, are as follows:

STATEMENTS OF FINANCIAL POSITION
		Place			Setting
Plant and equipment (net)	$	1,250,000		$	1,555,000
Investment in Setting		800,000
Current assets		950,000			800,000
	$	3,000,000		$	2,355,000
Common shares	$	1,000,000		$	550,000
Retained earnings		1,500,000			725,000
10% bonds payable					800,000
Current liabilities		500,000			280,000
	$	3,000,000		$	2,355,000

COMBINED INCOME AND RETAINED EARNINGS STATEMENTS
		Place			Setting
Sales	$	2,500,000		$	900,000
Cost of goods sold		1,200,000			330,000
Expenses		400,000			220,000
		1,600,000			550,000
Net operating income		900,000			350,000
Dividends received from Setting		100,000
Profit		1,000,000			350,000
Retained earnings, Jan. 1, Year 6		800,000			500,000
		1,800,000			850,000
Dividends declared and paid		300,000			125,000
Retained earnings, Dec. 31, Year 6	$	1,500,000		$	725,000

At December 31, Year 4, Places consolidated statement of financial position reported a non-controlling interest of $260,000. Setting did not declare any dividends during Year 4. What did Places consolidated income statement for the year ended December 31, Year 4, report as the non-controlling interests share of consolidated net income?

Multiple Choice

• $60,000

• $70,000

• $140,000

• $180,000