Park Incorporated purchased a 70% interest in Silk Company in 2008 at book value.On January 1,2010,equipment having a historical cost of $100,000 and a net book value of $70,000 is sold in an intercompany transfer for $90,000.The equipment has a remaining useful life of five years and no salvage value.Straight-line depreciation is used by both companies.Silk reports net income of $180,000 in 2010 and $200,000 in 2011.
Required:
1.Assume Park sold the equipment to Silk.
A.Prepare the consolidating worksheet entries for the equipment for 2010 and 2011.
B.Calculate the noncontrolling interest share in Silk's income for 2010 and 2011.
2.Assume that Silk sold the equipment to Park.
A.Prepare the consolidating worksheet entries for the equipment for 2010 and 2011.
B.Calculate the noncontrolling interest share in Silk's income for 2010 and 2011.

Question

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The Answer of Park Incorporated purchased a 70% interest in Silk Company in 2008 at book value.On January 1,2010,equipment having a historical cost of $100,000 and a net book value of $70,000 is sold in an intercompany transfer for $90,000.The equipment has a remaining useful life of five years and no salvage value.Straight-line depreciation is used by both companies.Silk reports net income of $180,000 in 2010 and $200,000 in 2011.
Required:
1.Assume Park sold the equipment to Silk.
A.Prepare the consolidating worksheet entries for the equipment for 2010 and 2011.
B.Calculate the noncontrolling interest share in Silk's income for 2010 and 2011.
2.Assume that Silk sold the equipment to Park.
A.Prepare the consolidating worksheet entries for the equipment for 2010 and 2011.
B.Calculate the noncontrolling interest share in Silk's income for 2010 and 2011.

Park Incorporated Purchased a 70% Interest in Silk Company in 2008