Boulder, Inc., obtained 90 percent of Rock Corporation on January 1, 2019. Annual amortization of $26,000 is applicable on the allocations of Rock's acquisition-date business fair value. On January 1, 2020, Rock acquired 75 percent of Stone Company's voting stock. Excess business fair-value amortization on this second acquisition amounted to $13,000 per year. For 2021, each of the three companies reported the following Information accumulated by its separate accounting system. Separate operating Income figures do not include any Investment or dividend Income. Boulder Rock Stone Separate Operating Income $397,500 137,500 200,000 Dividends Declared $123,000 27,000 47,000 Required: a. What is consolidated net Income for 2021? b. How is 2021 consolidated net Income distributed to the controlling and noncontrolling interests?

Boulder, Inc., obtained 90 percent of Rock Corporation on January 1, 2019. Annual amortization of $26,000 is applicable on the allocations of Rock's acquisition-date business fair value. On January 1, 2020, Rock acquired 75 percent of Stone Company's voting stock. Excess business fair-value amortization on this second acquisition amounted to $13,000 per year. For 2021, each of the three companies reported the following Information accumulated by its separate accounting system. Separate operating Income figures do not include any Investment or dividend Income. Boulder Rock Stone Separate Operating Income $397,500 137,500 200,000 Dividends Declared $123,000 27,000 47,000 Required: a. What is consolidated net Income for 2021? b. How is 2021 consolidated net Income distributed to the controlling and noncontrolling interests?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Boulder, Inc., obtained 90 percent of Rock Corporation on January 1, 2019. Annual amortization of $26,000 is applicable on the
allocations of Rock's acquisition-date business fair value. On January 1, 2020, Rock acquired 75 percent of Stone Company's
voting stock. Excess business fair-value amortization on this second acquisition amounted to $13,000 per year. For 2021, each of
the three companies reported the following information accumulated by its separate accounting system. Separate operating
Income figures do not include any Investment or dividend Income.
Boulder
Rock
Stone
Separate Operating Income
$397,500
a.
b.
137,500
200,000
Dividends Declared
Required:
a. What is consolidated net Income for 2021?
b. How is 2021 consolidated net income distributed to the controlling and noncontrolling Interests?
$123,000
27,000
47,000
Answer is not complete.
Consolidated net income for 2021
Controlling interest in consolidated net income
Noncontrolling interest in consolidated net income
Amount
$ 696,000
$
57,900

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