P Company owns an 80% interest in S Company.During 2017,S sells merchandise to P for $200,000 at a profit of $40,000.On December 31,2017,50% of this merchandise is included in P's inventory.Income statements for P and S are summarized below: Controlling interest in consolidated net income for 2017 is:
A)$300,000.
B)$380,000.
C)$396,000.
D)$420,000.

Question

P Company owns an 80% interest in S Company.During 2017,S sells merchandise to P for $200,000 at a profit of $40,000.On December 31,2017,50% of this merchandise is included in P's inventory.Income statements for P and S are summarized below:  Controlling interest in consolidated net income for 2017 is:
A)$300,000. 
B)$380,000. 
C)$396,000. 
D)$420,000.

Quizplus · Accepted Answer

The Answer of P Company owns an 80% interest in S Company.During 2017,S sells merchandise to P for $200,000 at a profit of $40,000.On December 31,2017,50% of this merchandise is included in P's inventory.Income statements for P and S are summarized below:  Controlling interest in consolidated net income for 2017 is:
A)$300,000. 
B)$380,000. 
C)$396,000. 
D)$420,000.

P Company Owns an 80% Interest in S Company