Question: A parent company acquired an 80 interest in a subsidiary

A parent company acquired an 80% interest in a subsidiary on July 1, 2011. The subsidiary closed its books on that date. The subsidiary reported net income of $60,000 for 2011, earned evenly during the year. The parent’s net income, exclusive of any income of the subsidiary, was $140,000. The fair value of the subsidiary exceeded book value by $100,000. The entire difference was attributed to a patent with a 10- year life.
a. What is consolidated net income for 2011?
b. What is the noncontrolling share of net income for 2011?

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