Question
The Parent acquired 60% of the sub on Jan 1, paying $480,000. The above balance sheets are for the parent and sub at the date
The Parent acquired 60% of the sub on Jan 1, paying $480,000. The above balance sheets are for the parent and sub at the date of acquisition. At the time of acquisition, any differential was attributed 50% to a trademark with a 10 year remaining life, and the remainder to goodwill.
During the first year after the acquisition, the Sub reported Net Income of $90,000 and paid dividends of $10,000. The parent had operating income of $225,000 (which did not include the income from the sub).
- What is the consolidated net income for the first year?
- What is the value of the NCI at the end of the first year?
- What income from sub will be reported on the parent’s income statement the first year?
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Part 1 The consolidated net income for the first year is 135000 In this situation the parent acquired 60 of the sub on January 1 paying 480000 The abo...Get Instant Access to Expert-Tailored Solutions
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Intermediate Accounting principles and analysis
Authors: Terry d. Warfield, jerry j. weygandt, Donald e. kieso
2nd Edition
471737933, 978-0471737933
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