Assuming Solar Company has paid no dividends, what are the noncontrolling interest's share of the subsidiary's income and the ending balance of the noncontrolling interest in the subsidiary? a b. C. d. e. $34,400 and $240,800 $26,000 and $230,000 $40,000 and $252,000 $28,800 and $252,000 None of the above.
Assuming Solar Company has paid no dividends, what are the noncontrolling interest's share of the subsidiary's income and the ending balance of the noncontrolling interest in the subsidiary? a b. C. d. e. $34,400 and $240,800 $26,000 and $230,000 $40,000 and $252,000 $28,800 and $252,000 None of the above.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:3.
Noncontrolling Interest. West Company acquired 60
percent of Solar Company for $300,000 when Solar's book
value was $400,000. The newly comprised 40 percent
noncontrolling interest had an assessed fair value of $200,000.
Also, at the acquisition date, Solar had a trademark (with a 10-
year life) that was undervalued in the financial records by
$60,000. Also, patented technology (with a 5-year life) was
undervalued by $40,000. Two years later, the following figures
are reported by these two companies (stockholders' equity
accounts are omitted):
Current assets
620,000
Trademarks
260,000
Patented technology 410,000
Liabilities
(390,000)
Revenues
(900,000
Expenses
500,000
Investment income Not given
W Company Solar Company
Book Value Book Value
a
b.
C.
d.
e.
300,000
200,000
150,000
(120,000)
(400,000
300,000
Assuming Solar Company has paid no dividends, what are the
noncontrolling interest's share of the subsidiary's income and
the ending balance of the noncontrolling interest in the
subsidiary?
Solar Company
Fair Value
$34,400 and $240,800
$26,000 and $230,000
$40,000 and $252,000
$28,800 and $252,000
None of the above.
320,000
280,000
190,000
(120,000)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education