ted net income; Liong Corporation paid $2,500,000 in cash for an 80 percent interest in Taro Corporation on January 1, 2016, when the book value of Taro’s net assets was $2,250,000. Some additional information is given below: a Land was overvalued by $100,000. b Equipment with a five-year remaining useful life was undervalued by $150,000. c Taro’s net income was $300,000. d Liong’s net income was $1,440,000, including an income of $240,000 from Taro. REQUIRED:
Correction of consolidated net income;
Liong Corporation paid $2,500,000 in cash for an 80 percent interest in Taro Corporation on January 1, 2016, when the book value of Taro’s net assets was $2,250,000. Some additional information is given below:
a Land was overvalued by $100,000.
b Equipment with a five-year remaining useful life was undervalued by $150,000.
c Taro’s net income was $300,000.
d Liong’s net income was $1,440,000, including an income of $240,000 from Taro.
REQUIRED:
1. Calculate the
2. Calculate consolidated net income for 2016.
Please proper explain and do not copy from chegg. otherwise I have to report the answer.
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