Use the following information for Problems #9 & #10 (Based on Exercise 6-8)

Investment acquired at mid-year (upstream and downstream sales):

Parent Corporation owns 60 percent of the outstanding voting stock of Sub Corporation, acquired for $240,000 on

July 1, 2011, when Subs common stockholders equity was $300,000. The excess of investment fair value over

book value acquired was due to valuable patents owned by Sub (with a useful life of 5 years) . Data for years 2011 & 2012 are summarized below:

Summary of Transactions:
	2011	2012
Sub's Net Income	$60,000	$90,000
Unrealized Profit in Ending Inventory (Upstream sale)	$6,000	$9,000
Gain on Sale of Land (Downstream)	$3,000

Note: This land is still owned by Sub at December 31, 2012.

Preliminary computations are given as follows:

Investment in Sub (at cost)	$240,000
Implied Fair Value of Sub ($240,000 / .6)	$400,000
BV of Sub	$300,000
Excess of FV over BV	$100,000

Problem #9:

Compute Parents investment income from Sub for 2011

Problem #10:

Compute Parents investment income from Sub for 2012