On January 1, 2014, Pinnead Incorporated paid $300,000 for an 80% interest in Shalle Company. At that

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Question:

On January 1, 2014, Pinnead Incorporated paid $300,000 for an 80% interest in Shalle Company. At that time, Shalle's total book value was $300,000. Patents were undervalued in the amount of $10,000. Patents had a 5 year remaining useful life, and any remaining excess value was attributed to goodwill. The income statements for the year ended December 31, 2014 of Pinnead and Shalle are summarized below:

Pinnead Shalle

Sales $800,000 $300,000

Income from Shalle 78,400

Cost of sales (100,000) (100,000)

Depreciation (70,000) (30,000)

Other expenses (130,000) (70,000)

Net income $578,400 $100,000

Part 1: Calculate the goodwill that will appear in the consolidated balance sheet of Pinnead and Subsidiary at December 31, 2014.

Part 2: Calculate consolidated net income for 2014.

Part 3: Calculate the noncontrolling interest share for 2014.