On January 1, 2009, Black Corporation sold equipment to its 70-percent-owned subsidiary, Levant Company, for $840,000. The equipment originally was purchased at the beginning of 2006 for $1,920,000. Levant continued to depreciate the equipment, with an original five year useful life, on a straight-line basis over its remaining 2-year life. The equipment's residual value is considered negligible. On July 7, 2009, Levant sold idle land to its parent for $260,000. The land's carrying amount on Levant's books was $180,000. During 2010, Black sold the land to an unaffiliated buyer at a $70,000 gain. Black reported income from its separate operations for 2009 and 2010 of $1,400,000 and $1,720,000, respectively. Levant reported net income for 2009 and 2010 of $1,220,000 and $1,140,000, respectively. Required: a. Compute consolidated net income, Income to the non-controlling interest, Income to the controlling interest for 2009 b. Compute consolidated net income, Income to the non-controlling interest, Income to the controlling interest for 2010.
On January 1, 2009, Black Corporation sold equipment to its 70-percent-owned subsidiary, Levant Company, for $840,000. The equipment originally was purchased at the beginning of 2006 for $1,920,000. L...
Controlling Interest in Income On January 1, 2014, Sherwood Company, an 80% owned subsidiary of Paradise Company, sold to Paradise Company equipment with a book value of $600,000 for $840,000. The equipment had an estimated remaining useful life of eight years on the date of the intercompany sale. Paradise Company reported net income from its independent operations of $550,000, and Sherwood Company reported net income of $300,000 in the years of 2014 and 2015. Required: Calculate the controlling interest in...
Assume that a parent company owns 75 percent of its subsidiary. On January 1, 2016, the parent company had a $100,000 (face value) 8 percent bond payable outstanding with a carrying value of $94,000. Several years ago, the bond was originally issued to an unaffiliated company for 92% of par value. On January 1, 2016, the subsidiary acquired the bond for $91,000. During 2016, the parent company reported $400,000 of (pre-consolidation) income from its own operations (prior to any equity...
On January 1, 2018, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $190,000 in cash. The equipment had originally cost $171,000 but had a book value of only $104,500 when transferred. On that date, the equipment had a five-year remaining life. Depreciation expense is computed using the straight-line method. Ackerman reported $470,000 in net income in 2018 (not including any investment income) while Brannigan reported $154,100. Ackerman attributed any excess acquisition-date fair value to Brannigan's unpatented technology, which...
On January 1, 2018, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $310,000 in cash. The equipment had originally cost $279,000 but had a book value of only $170,500 when transferred. On that date, the equipment had a five-year remaining life. Depreciation expense is computed using the straight-line method. Ackerman reported $410,000 in net income in 2018 (not including any investment income) while Brannigan reported $134,300. Ackerman attributed any excess acquisition-date fair value to Brannigan's unpatented technology, which...
On January 1, 2018, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $250,000 in cash. The equipment had originally cost $225,000 but had a book value of only $137,500 when transferred. On that date, the equipment had a five-year remaining life. Depreciation expense is computed using the straight-line method. Ackerman reported $350,000 in net income in 2018 (not including any investment income) while Brannigan reported $114,500. Ackerman attributed any excess acquisition date fair value to Brannigan's unpatented technology,...
On April 1, 2020, Republic Company sold equipment to its wholly owned subsidiary, Barre Corporation, for $40,000. At the time of the transfer, the asset had an original cost (to Republic) of $60,000 and accumulated depreciation of $25,000. The equipment has a five year estimated remaining life. Barre reported net income of $250,000, $270,000 and $310,000 in 2020, 2021, and 2022, respectively. Republic received dividends from Barre of $90,000, $105,000 and $120,000 for 2020, 2021, and 2022, respectively. Assume Republic...
On January 1, 2018, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $270,000 in cash. The equipment had originally cost $243,000 but had a book value of only $148,500 when transferred. On that date, the equipment had a five-year remaining life. Depreciation expense is computed using the straight-line method. Ackerman reported $370,000 in net income in 2018 (not including any investment income) while Brannigan reported $121,100. Ackerman attributed any excess acquisition-date fair value to Brannigan's unpatented technology, which...
On January 1, 2018, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $340,000 in cash. The equipment had originally cost $306,000 but had a book value of only $187,000 when transferred. On that date, the equipment had a five-year remaining life. Depreciation expense is computed using the straight-line method. Ackerman reported $440,000 in net income in 2018 (not including any investment income) while Brannigan reported $144,200. Ackerman attributed any excess acquisition-date fair value to Brannigan's unpatented technology, which...
On January 1, 2018, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $280,000 in cash. The equipment had originally cost $252,000 but had a book value of only $154,000 when transferred. On that date, the equipment had a five-year remaining life. Depreciation expense is computed using the straight-line method. Ackerman reported $380,000 in net income in 2018 (not including any investment income) while Brannigan reported $124,400. Ackerman attributed any excess acquisition-date fair value to Brannigan's unpatented technology, which...
On January 1, 2018, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $190,000 in cash. The equipment had originally cost $171,000 but had a book value of only $104,500 when transferred. On that date, the equipment had a five-year remaining life. Depreciation expense is computed using the straight-line method. Ackerman reported $470,000 in net income in 2018 (not including any investment income) while Brannigan reported $154,100. Ackerman attributed any excess acquisition-date fair value to Brannigan's unpatented technology, which...