Scott Company acquired 70% of Gregg Company for $525,000 on December 31, 2022 when Gregg's book value was $580,000. The Gregg stock was not actively traded. On the date of acquisition, Gregg had equipment (with a ten-year life) that was undervalued in the financial records by $170,000. One year later, the two companies provided the selected amounts shown below. Additionally, no dividends have been paid. Current assets Equipment Buildings Liabilities Revenues Expenses Investment Scott Book Value $ 912,000 371,000 584,000 (564,000) (1,320,000) Gregg Book Value $ 430,000 290,000 210,000 (238,000) (570,000) 410,000 Not Given 740,000 Fair Value $ 458,000 450,000 210,000 (238,000) income What amount of consolidated net income for 2023 is attributable to Scott's controlling interest?
Scott Company acquired 70% of Gregg Company for $525,000 on December 31, 2022 when Gregg's book value was $580,000. The Gregg stock was not actively traded. On the date of acquisition, Gregg had equipment (with a ten-year life) that was undervalued in the financial records by $170,000. One year later, the two companies provided the selected amounts shown below. Additionally, no dividends have been paid. Current assets Equipment Buildings Liabilities Revenues Expenses Investment Scott Book Value $ 912,000 371,000 584,000 (564,000) (1,320,000) Gregg Book Value $ 430,000 290,000 210,000 (238,000) (570,000) 410,000 Not Given 740,000 Fair Value $ 458,000 450,000 210,000 (238,000) income What amount of consolidated net income for 2023 is attributable to Scott's controlling interest?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Am. 111.
Transcribed Image Text:Scott Company acquired 70% of Gregg Company for $525,000 on December 31, 2022 when Gregg's book value was $580,000. The Gregg
stock was not actively traded. On the date of acquisition, Gregg had equipment (with a ten-year life) that was undervalued in the financial
records by $170,000. One year later, the two companies provided the selected amounts shown below. Additionally, no dividends have been
paid.
Current assets
Equipment
Buildings
Liabilities
Revenues
Expenses
Investment
Scott
Book Value
$ 912,000
371,000
584,000
(564,000)
(1,320,000)
Gregg
Book Value
$ 430,000
290,000
210,000
(238,000)
(570,000)
410,000
Not Given
740,000
Fair Value
$ 458,000
450,000
210,000
(238,000)
income
What amount of consolidated net income for 2023 is attributable to Scott's controlling interest?
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