Top Corporation acquired 80 percent of Bottom Corporation's common stock on January 1,20X8,for $520,000.At that date,Bottom reported common stock outstanding of $250,000 and retained earnings of $375,000.Assume the fair value of the noncontrolling interest on January 1,20X8 was $130,000.The book values and fair values of Bottom's assets and liabilities were equal on the acquisition date,except for other intangible assets,which had a fair value $25,000 greater than book value and a 5-year remaining life.Top and Bottom reported the following data for 20X8 and 20X9:
Compute consolidated comprehensive income for 20X8 and 20X9.
Compute comprehensive income attributable to the controlling interest for 20X8 and 20X9.

Question

Quizplus · Accepted Answer

The Answer of Top Corporation acquired 80 percent of Bottom Corporation's common stock on January 1,20X8,for $520,000.At that date,Bottom reported common stock outstanding of $250,000 and retained earnings of $375,000.Assume the fair value of the noncontrolling interest on January 1,20X8 was $130,000.The book values and fair values of Bottom's assets and liabilities were equal on the acquisition date,except for other intangible assets,which had a fair value $25,000 greater than book value and a 5-year remaining life.Top and Bottom reported the following data for 20X8 and 20X9:
Compute consolidated comprehensive income for 20X8 and 20X9.
Compute comprehensive income attributable to the controlling interest for 20X8 and 20X9.

Top Corporation Acquired 80 Percent of Bottom Corporation's Common Stock