Pat Corporation owns an 80 percent interest in Sam Corporation and a 70 percent interest in Ten Corporation. Ten owns a 10 percent interest in Sam. These investment interests were acquired at fair value equal to book value.

The net incomes of the affiliates for 2011 were as follows:

Pat ..... $240,000

Sam .... $ 80,000

Ten ..... $ 40,000

On December 31, 2011, Pat’s inventory included $10,000 of unrealized profits on merchandise purchased from Sam during 2011, and Sam’s land account reflected $15,000 unrealized profit on land purchased from Ten during 2011. These unrealized profits have not been eliminated from the net income amounts shown. Except for adjustments related to unrealized profits, the net income amounts were determined on a correct equity basis.

1. The separate incomes of Pat, Sam, and Ten for 2011 were:

(a) $240,000, $80,000, and $32,000, respectively

(b) $148,000, $80,000, and $32,000, respectively

(c) $148,000, $72,000, and $40,000, respectively

(d) $240,000, $72,000, and $40,000, respectively

2. The separate realized incomes of Pat, Sam, and Ten for 2011 were:

(a) $138,000, $80,000, and $25,000, respectively

(b) $138,000, $70,000, and $25,000, respectively

(c) $123,000, $80,000, and $17,000, respectively

(d) $148,000, $70,000, and $17,000, respectively

3. Controlling share of consolidated net income for Pat Corporation and Subsidiaries for 2011 was:

(a) $220,800

(b) $215,900

(c) $214,400

(d) $212,400

4. Noncontrolling interest share that should appear in the consolidated income statement for Pat Corporation and Subsidiaries for 2011 is:

(a) $23,600

(b) $21,200

(c) $19,100

(d) $14,200