On January 1, 20XB, Gregory 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. Gregory uses the cost method in accounting for its ownership of Nova. The income statement of Gregory and Nova for the year 20X8 are given below: Sales Revenue Dividend Revenue Total Revenue Less: Expenses Net Income Gregory Corp 200,000 +9,000 209,000 -139,000 70,000 Nova Corp 120,000 120,000 - 90,000 30,000 Nova paid a dividend of $10,000 for the year 20X8.
On January 1, 20XB, Gregory 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. Gregory uses the cost method in accounting for its ownership of Nova. The income statement of Gregory and Nova for the year 20X8 are given below: Sales Revenue Dividend Revenue Total Revenue Less: Expenses Net Income Gregory Corp 200,000 +9,000 209,000 -139,000 70,000 Nova Corp 120,000 120,000 - 90,000 30,000 Nova paid a dividend of $10,000 for the year 20X8.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On January 1, 20X8, Gregory 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. Gregory uses the cost method in accounting for its ownership of Nova. The income statement of
Gregory and Nova for the year 20X8 are given below:
Sales Revenue
Dividend Revenue
Total Revenue
Less: Expenses
Net Income
$97,000
Gregory Corp
200,000
$3,000
$9,000
+9,000
209,000
-139,000
70,000
Nova Corp
120,000
Nova paid a dividend of $10,000 for the year 20X8.
What amount should be reported as non-controlling interest in net income in the consolidated income statement?
$27,000
120,000
- 90,000
30,000
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