Chase Company owns 80% of Lawrence Company and 40% of Ross Company. Lawrence Company also owns 30% of Ross Company. Separate company net incomes for 2021 of Chase, Lawrence, and Ross are $450,000, $300,000, and $250,000, respectively. Each company also defers a $20,000 intra-entity gain in its current income figures. Excess annual amortization expense of $15,000 is assigned to Chase's investment in Lawrence and another $15,000 is assigned to Lawrence's investment in Ross.Compute Chase's accrual-based net income for 2021.
A) $746,000.
B) $719,000.
C) $779,600.
D) $774,200.
E) $758,100.

Question

Quizplus · Accepted Answer

The Answer of Chase Company owns 80% of Lawrence Company and 40% of Ross Company. Lawrence Company also owns 30% of Ross Company. Separate company net incomes for 2021 of Chase, Lawrence, and Ross are $450,000, $300,000, and $250,000, respectively. Each company also defers a $20,000 intra-entity gain in its current income figures. Excess annual amortization expense of $15,000 is assigned to Chase's investment in Lawrence and another $15,000 is assigned to Lawrence's investment in Ross.Compute Chase's accrual-based net income for 2021.
A) $746,000.
B) $719,000.
C) $779,600.
D) $774,200.
E) $758,100.

Chase Company Owns 80% of Lawrence Company and 40% of Ross