Pell Company acquires 80% of Demers Company for $500,000 on January 1, 2010. Demers reported common stock of $300,000 and retained earnings of $210,000 on that date. Equipment was undervalued $30,000 and buildings were undervalued by $40,000, each having a 10-yea remaning life. Any Excess consideration transferred over fair value was attributed to goodwill with an indefinite life. Based on annual review, goodwill has not been impaired.

Demers earns income and pays dividends are as follows:

	2010	2011	2012
Net Income	100,000	120,000	130,000
Dividends	40,000	50,000	60,000

ASSUME Initial Value method! - I used the equity method and got them wrong! Trying to fix it! Please show work! I'm trying to learn!

1) How much does Pell record as Income from Demers for the year ended Dec. 31, 2011?

a)90,400 b)40,000 c)89,000 d)50,400, e)56,000

2) How much does Pell record as Income from Demers for the year ended Dec. 31, 2012?

a)48,000 b)56,000 c)98,400 d)97,000 e)56,000

3) Compute the noncontrolling interest in the net income of Demers at Dec 31, 2010?

a)12,000 b)10,600, c)18,600, d)20,000, e)14,400

4) Compute the noncontrolling interest in teh net income of Demers at Dec 31, 2011?

a)18,400 b)14,00, c)22,600 D)24,000 e)12,600

Please show work!