Homework Answers
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| Pet | Man | Nun | Oak | ||
| Separate earnings | $ 130,000 | $ 36,000 | $ 56,000 | $ 18,000 | |
| Unrealized profit | $ (8,000) | $ 4,000 | $ (8,000) | ||
| Separate realized earnings | $ 130,000 | $ 28,000 | $ 60,000 | $ 10,000 | |
| Allocate Oak’s income: | |||||
| 20% to Nun | $ 2,000 | $ (2,000) | |||
| 70% to Man | $ 7,000 | $ (7,000) | |||
| Allocate Nun’s income: | |||||
| 70% to Pet | $ 43,400 | $ (43,400) | |||
| 10% to Man | $ 6,200 | $ (6,200) | |||
| Allocate Man’s income: | |||||
| 90% to Pet | $ 37,080 | $ (37,080) | |||
| Pet’s net income (or Controlling share of NI) | $ 210,480 | ||||
| Noncontrolling interest share | $ 4,120 | $ 12,400 | $ 1,000 | ||
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Calculate controlling interest share and noncontrolling interest share of consolidated net income Pet Company owns 90 p...
EXERCISE 5-5 T-Account Calculation of Controlling and Noncontrolling Interest in Consolidated Net Income LO 4 On...
EXERCISE 5-5 T-Account Calculation of Controlling and Noncontrolling Interest in Consolidated Net Income LO 4 On January 1, 2019, P Company purchased an 80% interest in S Company for $600,000, at which time S Company had retained earnings of $300,000 and capital stock of $350,000. Any difference between book value and the value implied by the purchase price was entirely attributable to a patent with a remaining useful life of 10 years. Assume that P and S Companies reported net...
Calculating net income, noncontrolling interest share, and controlling interest share with unrealized profits The affil...
Calculating net income, noncontrolling interest share, and controlling interest share with unrealized profits The affiliation structure for Parang Corporation and Subsidiaries is as follows: Parang 80% Sangkur 60% Keris The investments were acquired at fair value equal to book value in 2016. Parang's ending balance of inventories in 2016 includes unrealized profits of $15,000 from Sangkur. Keris's land account includes unrealized profits of $10,000 from Sangkur. Separate incomes (not including investment income) for all companies for 2016 are: Parang Sangkur...
Peat Company owns a 90% interest in Seaton Company. The consolidated income statement drafted by the...
Peat Company owns a 90% interest in Seaton Company. The
consolidated income statement drafted by the controller of Peat
Company appeared as follows:
Peat
Company and Subsidiary
Consolidated Income Statement
for Year Ended December 31, 2015
Sales
$14,098,400
Cost of Sales
9,191,200
Operating Expense
1,784,000
10,975,200
Consolidated Income
3,123,200
Less Noncontrolling Interest
in Consolidated Income
212,320
Controlling Interest in
Consolidated Net Income
$2,910,880
During your audit you discover that intercompany sales transactions
were not reflected in the controller’s draft of...
Preparing a consolidated income statement-Cost method with noncontrolling interest, AAP and upstream and downstream intercompany inventory...
Preparing a consolidated income statement-Cost method with noncontrolling interest, AAP and upstream and downstream intercompany inventory profits A parent company purchased a 70% controlling interest in its subsidiary several years ago. The aggregate fair value of the controlling and noncontrolling interest was $300,000 in excess of the subsidiary's Stockholders' Equity on the acquisition date. This excess was assigned to a building that was estimated to be undervalued by $180,000 and to an unrecorded Trademark valued at $120,000. The building asset...
Preparing a consolidated income statement—Cost method with noncontrolling interest, AAP and upstream and downstream intercompany inventory...
Preparing a consolidated income statement—Cost method
with noncontrolling interest, AAP and upstream and downstream
intercompany inventory profits
A parent company purchased a 70% controlling interest in its
subsidiary several years ago. The aggregate fair value of the
controlling and noncontrolling interest was $300,000 in excess of
the subsidiary’s Stockholders’ Equity on the acquisition date. This
excess was assigned to a building that was estimated to be
undervalued by $180,000 and to an unrecorded Trademark valued at
$120,000. The building asset...
Problem 6 Paice Corporation owns 80% of the voting common stock of Accardi Corporation. Paice owns...
Problem 6 Paice Corporation owns 80% of the voting common stock of Accardi Corporation. Paice owns 60% of the voting common stock of Badger Corporation. Accardi owns 20% of the voting common stock of Badger. There are no cost/book value/fair value differentials to consider. The separate net incomes (excluding investment income) of these affiliated companies for 2014 are: Paice Accardi Badger $300,000 160,000 120,000 Required: Calculate controlling interest share of consolidated net income and noncontrolling interest shares for Paice Corporation...
P Company owns 80% of the outstanding stock of S Company. During 2014, S Company reported...
P Company owns 80% of the outstanding stock of S Company. During 2014, S Company reported net income of $500,120 and declared no dividends. At the end of the year, S Company’s inventory included $442,130 in unrealized profit on purchases from P Company. Intercompany sales for 2014 totaled $2,962,200. Calculate the amount of the noncontrolling interest to be deducted from consolidated income in arriving at 2014 controlling interest in consolidated net income.
Exercise 5-5 On January 1, 2014, P Company purchased an 80% interest in s Company for...
Exercise 5-5 On January 1, 2014, P Company purchased an 80% interest in s Company for $590,400, at which time S Company had retained earnings of $310,800 and common stock of $344,300. Any difference between book value and the value implied by the purchase price was entirely attributable to a patent with a remaining useful life of 10 years. Assume that P and S Companies reported net incomes from their independent operations of $195,800 and $100,300, respectively. Calculate the controlling...
On January 1, 2015, P Company acquired a 90% interest in S Company. During 2016, S...
On January 1, 2015, P Company acquired a 90% interest in S Company. During 2016, S Company sold merchandise to P Company at 25% above cost in the amount (selling price) of $208,800. At the end of the year, P Company had in its inventory one-third of the amount of goods purchased from S Company. On January 1, 2016, P Company sold equipment that had a book value of $75,500 to S Company for $131,700. The equipment had an estimated...
Exercise 7-8 On January 1, 2015, P Company acquired a 90% interest in S Company. During...
Exercise 7-8 On January 1, 2015, P Company acquired a 90% interest in S Company. During 2016, S Company sold merchandise to P Company at 25% above cost in the amount (selling price) of $241,800. At the end of the year, P Company had in its inventory one-third of the amount of goods purchased from S Company. On January 1, 2016, P Company sold equipment that had a book value of $83,600 to S Company for $118,100. The equipment had...
EXERCISE 5-5 T-Account Calculation of Controlling and Noncontrolling Interest in Consolidated Net Income LO 4 On January 1, 2019, P Company purchased an 80% interest in S Company for $600,000, at which time S Company had retained earnings of $300,000 and capital stock of $350,000. Any difference between book value and the value implied by the purchase price was entirely attributable to a patent with a remaining useful life of 10 years. Assume that P and S Companies reported net...
Calculating net income, noncontrolling interest share, and controlling interest share with unrealized profits The affiliation structure for Parang Corporation and Subsidiaries is as follows: Parang 80% Sangkur 60% Keris The investments were acquired at fair value equal to book value in 2016. Parang's ending balance of inventories in 2016 includes unrealized profits of $15,000 from Sangkur. Keris's land account includes unrealized profits of $10,000 from Sangkur. Separate incomes (not including investment income) for all companies for 2016 are: Parang Sangkur...
Peat Company owns a 90% interest in Seaton Company. The
consolidated income statement drafted by the controller of Peat
Company appeared as follows:
Peat
Company and Subsidiary
Consolidated Income Statement
for Year Ended December 31, 2015
Sales
$14,098,400
Cost of Sales
9,191,200
Operating Expense
1,784,000
10,975,200
Consolidated Income
3,123,200
Less Noncontrolling Interest
in Consolidated Income
212,320
Controlling Interest in
Consolidated Net Income
$2,910,880
During your audit you discover that intercompany sales transactions
were not reflected in the controller’s draft of...
Preparing a consolidated income statement-Cost method with noncontrolling interest, AAP and upstream and downstream intercompany inventory profits A parent company purchased a 70% controlling interest in its subsidiary several years ago. The aggregate fair value of the controlling and noncontrolling interest was $300,000 in excess of the subsidiary's Stockholders' Equity on the acquisition date. This excess was assigned to a building that was estimated to be undervalued by $180,000 and to an unrecorded Trademark valued at $120,000. The building asset...
Preparing a consolidated income statement—Cost method
with noncontrolling interest, AAP and upstream and downstream
intercompany inventory profits
A parent company purchased a 70% controlling interest in its
subsidiary several years ago. The aggregate fair value of the
controlling and noncontrolling interest was $300,000 in excess of
the subsidiary’s Stockholders’ Equity on the acquisition date. This
excess was assigned to a building that was estimated to be
undervalued by $180,000 and to an unrecorded Trademark valued at
$120,000. The building asset...
Problem 6 Paice Corporation owns 80% of the voting common stock of Accardi Corporation. Paice owns 60% of the voting common stock of Badger Corporation. Accardi owns 20% of the voting common stock of Badger. There are no cost/book value/fair value differentials to consider. The separate net incomes (excluding investment income) of these affiliated companies for 2014 are: Paice Accardi Badger $300,000 160,000 120,000 Required: Calculate controlling interest share of consolidated net income and noncontrolling interest shares for Paice Corporation...
Exercise 5-5 On January 1, 2014, P Company purchased an 80% interest in s Company for $590,400, at which time S Company had retained earnings of $310,800 and common stock of $344,300. Any difference between book value and the value implied by the purchase price was entirely attributable to a patent with a remaining useful life of 10 years. Assume that P and S Companies reported net incomes from their independent operations of $195,800 and $100,300, respectively. Calculate the controlling...
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