Silverman Corporation is a 70 percent-owned subsidiary of Pruitt Corporation, was acquired several years ago at...

 

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Silverman Corporation is a 70 percent-owned subsidiary of Pruitt Corporation, was acquired several years ago at book value equal to fair value. For the years 19X1 and 19X2, Pruitt and Silverman report the following: 19X1 19X2 Pruitt's separate income S300,000 80,000 $400,000 60,000 Silverman's net income -The only intercompany transaction between Pruitt and Silverman during 19X1 and 19X2 was the January 1, 19X1 sale of an equipment by Pruitt to Silverman. The equipment had a book value of $25,000 and remaining life of five years was for $30,000, its appraised value at the time of sale. 1. The amount of gain on sale of equipment that should be reported in the 19X1 consolidated Income Statement is: $5,000 b. $4,000 $3,000 а. c. $2,400 e. Zero d. 2. Consolidated net income for 19X1 is: S253,200 S300,000 S351,000 b. $352,000 S376,000 а. с. d. е. 3. Minority income for 19X1 is: a. $22,800 b. $24,000 c. $22,500 d. $22,800 e. None of the above 4. Consolidated net income for 19X2 is: a. $400,000 a. $460,000 b. $443,000 $441,000 d. $442,000 с. Silverman Corporation is a 70 percent-owned subsidiary of Pruitt Corporation, was acquired several years ago at book value equal to fair value. For the years 19X1 and 19X2, Pruitt and Silverman report the following: 19X1 19X2 Pruitt's separate income S300,000 80,000 $400,000 60,000 Silverman's net income -The only intercompany transaction between Pruitt and Silverman during 19X1 and 19X2 was the January 1, 19X1 sale of an equipment by Pruitt to Silverman. The equipment had a book value of $25,000 and remaining life of five years was for $30,000, its appraised value at the time of sale. 1. The amount of gain on sale of equipment that should be reported in the 19X1 consolidated Income Statement is: $5,000 b. $4,000 $3,000 а. c. $2,400 e. Zero d. 2. Consolidated net income for 19X1 is: S253,200 S300,000 S351,000 b. $352,000 S376,000 а. с. d. е. 3. Minority income for 19X1 is: a. $22,800 b. $24,000 c. $22,500 d. $22,800 e. None of the above 4. Consolidated net income for 19X2 is: a. $400,000 a. $460,000 b. $443,000 $441,000 d. $442,000 с.

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