P owns 40% of S. Professional judgement has applied, and it is concluded that P controls S. The 2019 partial pre-tax income statements of both companies are shown below. Assume no other expenses than indicated below. Revenues S $150,000 $85,000 Miscellaneous Expenses Depreciation Expense $40,000 $30,000 $20,000 $25,000 On January 1, 2019, S sold equipment to P at a profit of $7.000 (before tax). The equipment had a remaining useful life of twenty-five years on that date. During 2019 S declared a dividend of $2.000. Further during 2019, there was a goodwill impairment of $1.000. Required: Assuming a tax rate of 40%. Create a consolidated income statement, including the share attributable to the non-controlling interest.

P owns 40% of S. Professional judgement has applied, and it is concluded that P controls S. The 2019 partial pre-tax income statements of both companies are shown below. Assume no other expenses than indicated below. Revenues S $150,000 $85,000 Miscellaneous Expenses Depreciation Expense $40,000 $30,000 $20,000 $25,000 On January 1, 2019, S sold equipment to P at a profit of $7.000 (before tax). The equipment had a remaining useful life of twenty-five years on that date. During 2019 S declared a dividend of $2.000. Further during 2019, there was a goodwill impairment of $1.000. Required: Assuming a tax rate of 40%. Create a consolidated income statement, including the share attributable to the non-controlling interest.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

WCC Corporation has a $125,000 net operating loss carryover into 2021. Assume that it reported $80,000 of taxable income in 2021 (before the net operating loss deduction) and $55,000 of taxable income in 2022 (before the net operating loss deduction). (Leave no answer blank. Enter zero if applicable.) b. What is WCC’s taxable income in 2021 and 2022 (after the net operating loss deduction), assuming the $125,000 NOL carryover originated in 2020 and WCC elected to not carry back the loss?
Goose Corporation, a C corporation, incurs a net capital loss of $23,900 for 2021. It also has ordinary income of $19,120 in 2021. Goose had net capital gains of $4,780 in 2017 and $9,560 in 2020. If an amount is zero, enter "0". a. Determine the amount, if any, of the net capital loss of $23,900 that is deductible in 2021.$fill in the blank 1 _______ ? b. Determine the amount, if any, of the net capital loss of $23,900 that is carried forward to 2022.$fill in the blank 1 ______?
WCC Corp. has a $225,000 net operating loss carryover into 2023. Assume that it reported $100,000 of taxable income in 2023 (before the net operating loss deduction) and $155,000 of taxable income in 2024 (before the net operating loss deduction).b. What is WCC's taxable income in 2023 and 2024 (after the net operating loss deduction), assuming the $155,000 NOL carryover originated in 2020 and WCC elected to forgo the NOL carry back option? 2023 taxable income? 2024 taxable income?
Fullerton Corporation owns 100% of Irvine Corporation's common stock. On January 2, 2020, Fullerton sold machinery with a carrying amount of $30,000 to Irvine Corp for $50,000. Irvine Corp is depreciating the acquired machinery over a 10-year life using the straight-line method. The related net adjustments to compute the 2020 and 2021 consolidated income (gain, loss, depreciation expense, etc.) before income tax would be an increase (decrease) of: Select one: a. $(16,000) for 2020 and $4,000 for 2021 b. $(18,000) for 2020 and $2,000 for 2021 c. $(20,000) for 2020 and $2,000 for 2021 d. $(20,000) for 2020 and $0 for 2021
Assume that Puritan Corporation operates in an industry for which NOL carryback is allowed. Puritan Corporation reported the following pretax accounting income and taxable income for its first three years of operations: 2023 $ 348,000 2024 (534,000) 2025 765,000 Puritan's tax rate is 25% for all years. Puritan elected a loss carryback. As of December 31, 2024. Puritan was certain that it would recover the full tax benefit of the NOL that remained after the operating loss carryback. What would Puritan report as net income for 2025? Multiple Choice $623.554 $573,750 $143,448 $621,562