Company S is an 80% owned subsidiary of Company P. For 2011, Company P reports internally generated
Question:
Company S is an 80% owned subsidiary of Company P. For 2011, Company P reports internally generated income before tax of $100,000. Company S reports an income before tax of $40,000. A 30% tax rate applies to both companies. Calculate consolidated net income (after taxes) and the distribution of income to the controlling and non-controlling interests, if:
a. The consolidated firm meets the requirements of an affiliated firm and files a consolidated tax return.
b. The consolidated firm does not meet the requirements of an affiliated firm and files separate tax returns. Assume an 80% dividend exclusion rate.
DistributionThe word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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a Consolidated net income 100000 40000 X 70 98000 Distribution to NCI 40000 ...View the full answer
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Related Book For 
Advanced Accounting
ISBN: 978-0538480284
11th edition
Authors: Paul M. Fischer, William J. Tayler, Rita H. Cheng
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