On January 1, 2011, Pin Industries purchased a 40 percent interest in Sip Corporation for $800,000, when
Question:
On January 1, 2011, Pin Industries purchased a 40 percent interest in Sip Corporation for $800,000, when Sip’s stockholders’ equity consisted of $1,000,000 capital stock and $1,000,000 retained earnings. On September 1, 2011, Pin purchased an additional 20 percent interest in Sip for $420,000. Both purchases were made at book value equal to fair value. Sip had income for 2011 of $240,000, earned evenly throughout the year, and it paid dividends of $60,000 in April and $60,000 in October.
REQUIRED: Compute the following:
1. Pin’s income from Sip for 2011
2. Preacquisition income that will appear on the consolidated income statement for 2011
3. Noncontrolling interest share for 2011
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Step by Step Answer:
1 Income from Sip for 2011 40 interest x 240000 x 812 year 6...View the full answer
Advanced Accounting
ISBN: 9780132568968
11th Edition
Authors: Floyd A. Beams, Joseph H. Anthony, Bruce Bettinghaus, Kenneth Smith
