Pappas Company owns 85 percent of Sunny Company's stock and 80 percent of Sibble Company's stock.All acquisitions were made at book value.The fair values of noncontrolling interests at the time of acquisition were equal to the proportionate share of the book values of the companies.The companies file a consolidated tax return each year and in 20X9 paid a total tax of $112,000.Each company is involved in a number of intercompany inventory transfers each period.Information on the companies' activities for 20X9 is as follows:
Pappas Company does not record income tax expense on income from subsidiaries because a consolidated tax return is filed.
-Based on the information provided,income to the controlling interest for 20X9 is:
A)$155,370.
B)$56,000.
C)$168,000.
D)$250,000.

Question

Pappas Company owns 85 percent of Sunny Company's stock and 80 percent of Sibble Company's stock.All acquisitions were made at book value.The fair values of noncontrolling interests at the time of acquisition were equal to the proportionate share of the book values of the companies.The companies file a consolidated tax return each year and in 20X9 paid a total tax of $112,000.Each company is involved in a number of intercompany inventory transfers each period.Information on the companies' activities for 20X9 is as follows:
  Pappas Company does not record income tax expense on income from subsidiaries because a consolidated tax return is filed.
-Based on the information provided,income to the controlling interest for 20X9 is:
A)$155,370. 
B)$56,000. 
C)$168,000. 
D)$250,000.

Quizplus · Accepted Answer

The correct answer is derived by calculating the net income attributable to the controlling interest, which typically involves subtracting any minority interest from the total net income or adjusting based on the percentage of ownership the controlling interest has in the subsidiary or entity in question. Without specific details on the calculation, the correct answer is chosen based on the information provided.

Pappas Company Owns 85 Percent of Sunny Company's Stock and 80