Anderson Company, a 90% owned subsidiary of Philbin Corporation, transfers inventory to Philbin at a 25% gross
Question:
Anderson Company, a 90% owned subsidiary of Philbin Corporation, transfers inventory to Philbin at a 25% gross profit rate. The following data are available pertaining specifically to Philbin’s intra-entity purchases from Anderson. Anderson was acquired on January 1, 2020.
2020 | 2021 | 2022 | |||||||
Purchases by Philbin | $ | 8,000 | $ | 12,000 | $ | 15,000 | |||
Ending inventory on Philbin’s books | 1,200 | 4,000 | 3,000 | ||||||
Assume the equity method is used. The following data are available pertaining to Anderson’s income and dividends.
2020 | 2021 | 2022 | |||||||
Anderson’s net income | $ | 70,000 | $ | 85,000 | $ | 94,000 | |||
Dividends paid by Anderson | 10,000 | 10,000 | 15,000 | ||||||
Assuming there are no excess amortizations associated with the consolidation, and no other intra-entity asset transfers, compute the net income attributable to the noncontrolling interest of Anderson for 2022.
$9,425. | ||
$9,400. | ||
$8,485. | ||
$9,325. | ||
$9,375. |
Intermediate Accounting
ISBN: 978-0078025839
9th edition
Authors: J. David Spiceland, James Sepe , Mark Nelson , Wayne Thomas