Answered: On January 1, 20X8, Greg Corporation… | bartleby

On January 1, 20X8, Greg Corporation acquired 90 percent of Nova Company's voting stock, at underlying book value. The fair value of Nova's stock was equal to its books value. Greg uses the equity method in accounting for its ownership of Nova. The income statement of Gregory and Nova for the year 20X8 are given below: Sales Revenue Total Revenue Less: Expenses Net Income $100,000 $329,000 $97,000 Greg Corp $109,000 200,000 200,000 -130,000 70,000 Nova Corp 120,000 Nova paid a dividend of $10,000 for the year 20X8. What amount will be reported by Gregory as the controlling net income in the consolidated income statement? 120,000 - 90,000 30,000

SWFT Essntl Tax Individ/Bus Entities 2020

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter15: S Corporations

Section: Chapter Questions

Problem 23P

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On January 1, 20X8, Greg Corporation acquired 90 percent of Nova Company's voting stock, at underlying book value. The fair value of
Nova's stock was equal to its books value. Greg uses the equity method in accounting for its ownership of Nova. The income statement
of Gregory and Nova for the year 20X8 are given below:
Sales Revenue
Total Revenue
Less: Expenses
Net Income
$100,000
$329,000
$97,000
Greg Corp.
$109,000
200,000
200,000
-130,000
70,000
Nova Corp
120,000
Nova paid a dividend of $10,000 for the year 20X8.
What amount will be reported by Gregory as the controlling net income in the consolidated income statement?
120,000
- 90,000
30,000

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