On January 1, 20x1, ABC Company acquired 80% of XYZ Company’s common stock for 275,000 cash. At that date, XYZ reported common stock outstanding of 200,000 and retained eamings of 100,000 and the fair and book value of XYZ's assets and liabilities were equal, except for other intangible assets, which has a fair value 50,000 greater than book value and an 8-year remaining life. XYZ reported the following data for 20x1 and 20x2. Year Net Income Comprehensive Income 30,000 45,000 Dividends Paid 20x1 20x2 25,000 35,000 5,000 10,000 Bright reported separate net income from own operations of 100,000 and paid dividends of 30,000 for both years.
On January 1, 20x1, ABC Company acquired 80% of XYZ Company’s common stock for 275,000 cash. At that date, XYZ reported common stock outstanding of 200,000 and retained eamings of 100,000 and the fair and book value of XYZ's assets and liabilities were equal, except for other intangible assets, which has a fair value 50,000 greater than book value and an 8-year remaining life. XYZ reported the following data for 20x1 and 20x2. Year Net Income Comprehensive Income 30,000 45,000 Dividends Paid 20x1 20x2 25,000 35,000 5,000 10,000 Bright reported separate net income from own operations of 100,000 and paid dividends of 30,000 for both years.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
What is the amount of income attributable to the non-controlling interest in 20x1 if the non-controlling interest is to be stated at fair value?
Transcribed Image Text:On January 1, 20x1, ABC Company acquired 80% of XYZ Company's common stock for
275,000 cash. At that date, XYZ reported common stock outstanding of 200,000 and retained
eamings of 100,000 and the fair and book value of XYZ's assets and liabilities were equal,
except for other intangible assets, which has a fair value 50,000 greater than book value and an
8-year remaining life. XYZ reported the following data for 20x1 and 20x2.
Year
Net Income
Dividends Paid
Comprehensive
Income
5,000
10,000
20x1
25,000
35,000
30,000
45,000
20x2
Bright reported separate net income from own operations of 100,000 and paid dividends of
30,000 for both years.
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