Business, 26.03.2020 20:35 dbhuggybearow6jng

Pop Corporation purchased 80 percent of the outstanding voting common stock of Son Corporation on January 2, 2016, for $1,200,000 cash. Son’s balance sheets on this date and on December 31, 2016, are as follows:

January 2 December 31
Inventories 200000 80000
Other Current assets 200000 320000
Plant assets-net 800000 880000
Total assets 1200000 1280000
Liabilities 200000 240000
Capitial stock 600000 600000
Retained earnings 400000 440000
Total equity 1200000 1280000
ADDITIONAL INFORMATION
1. Pop uses the equity method of accounting for its investment in Son
2. Son’s 2016 net income and dividends were $280,000 and $240,000, respectively.
3. Son’s inventory, which was sold in 2016, was undervalued by $50,000 at January 2, 2016
REQUIRED
1. What is Pop’s income from Son for 2016?
2. What is the noncontrolling interest share for 2016

Answers: 3

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