Question

Arnold Corporation holds 70 percent of Belvista, which, in turn, owns 70 percent of Stang. Separate operating income figures (excluding investment income) and intra-entity upstream gains (on assets remaining within the consolidated group) included in the income for the current year follow:

 

	Arnold			Belvista			Stang
Separate operating income	$	625,000		$	305,000		$	240,000
Intra-entity gains		0			18,000			50,000

 

What is the amount of consolidated net income attributable to the noncontrolling interest

Answer 1

Consolidated Financial Statements

Consolidated Financial Statements are statements of a group of companies where the parent as well as subsidiary companies assets, liabilities and equities are accounted together as a single entity. It is different from combined financial statements. Consolidated financial statements have a parent company who have controlling interest over its subsidiaries whereas combined financial statements does have a company that has controlling power over other companies.

A holds 70 percent of B which holds 70 percent of S. Separate operating income and inter-entity upstream gains for the year is provided. The net income that is attributable to the non-controlling interest is calculated below-

Compute consolidated net income attributable to non-controlling interest as given below:

Compute consolidated net income attributable to non-controlling interest using spreadsheet formulas as given below:

Thus, the total non-controlling interest is $143,100. Correct option is option A.