Question $7$: On January $1,2015,$ Pomegranate Company acquired $80\%$ of the voting stock of Starfruit Company for $$89,200,000$ in cash. The fair value of the noncontrolling interest in Starfruit at the date of acquisition was $$13,000,000.$ Starfruit's book value was $$12,800,000$ at the date of acquisition. Starfruit's assets and liabilities were reported on its books at values approximating fair value, except its plant and equipment $(10-$year life, straight$-$line$)$ was overvalued by $$25,000,000.$ Starfruit Company had previously unreported intangible assets, with a market value of $$40,000,000$ and $5-$year life, straight$-$line, which were capitalized following GAAP.

Additional information

Pomegranate uses the complete equity method to account for its investment in Starfruit on its own books. Goodwill recognized in this acquisition was impaired by a total of $$2,000,000$ in $2015$ and $2016,$ and by $$500,000$ in $2017.$ It is now December $31,2017,$ the accounting year$-$end. Here is Starfruit Company's trial balance at December $31,2017$:

Dr $($Cr$)$

Current assets $$27,000,000$

Plant & equipment, net $188,000,000$

Intangibles $2,500,000$

Liabilities $(179,000,000)$

Capital stock $(1,100,000)$

Retained earnings, January $1(29,800,000)$

Acumulated other comprehensive income, January $1(500,000)$

Dividends $400,000$

Sales revenue $(24,000,000)$

Cost of goods sold $10,000,000$

Operating expenses $6,600,000$

Other comprehensive income $(100,000)$

$ $0$

On the $2017$ consolidated income statement, the noncontrolling interest in net income of Starfruit is

$$280,000$

$$330,000$

$$200,000$

$$750,000$