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On January 1, 20X1, Peace, Inc., acquired 70 percent of Silver's outstanding voting stock. At that date, $74,000 of the acquisition- date fair value was assigned to unrecorded contracts (with a 10-year life).

On January 1, 20X1, Peace, Inc., acquired 70 percent of Silver's outstanding voting stock. At that date, $74,000 of the acquisition- date fair value was assigned to unrecorded contracts (with a 10-year life).

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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On January 1, 20X1, Peace, Inc., acquired 70 percent of Silver's outstanding voting stock. At that date, $74,000 of the acquisition- date fair value was assigned to unrecorded contracts (with a 10-year life). In 20X1, Silver sold inventory costing $21,700 to Peace for $31,000. Of this merchandise, Peace continued to hold $5,000 at year-end. During 20X2, Silver transferred inventory costing $21,600 to Peace for $36,000. Peace still held half of these items at year-end. Silver reported $84,000 of net income for year 20X2. The amount of net income attributable to the noncontrolling interest for 20X2 would be:
Transcribed Image Text:On January 1, 20X1, Peace, Inc., acquired 70 percent of Silver's outstanding voting stock. At that date, $74,000 of the acquisition- date fair value was assigned to unrecorded contracts (with a 10-year life). In 20X1, Silver sold inventory costing $21,700 to Peace for $31,000. Of this merchandise, Peace continued to hold $5,000 at year-end. During 20X2, Silver transferred inventory costing $21,600 to Peace for $36,000. Peace still held half of these items at year-end. Silver reported $84,000 of net income for year 20X2. The amount of net income attributable to the noncontrolling interest for 20X2 would be:
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