The following data pertains to questions
Parent and Sub Inc had the following balance sheets on July 31,2007: The Net Incomes for Parent and Sub Inc for the year ended July 31,2007 were $120,000 and $60,000 respectively.
-Assuming that Parent Inc acquires 80% of Sub Inc,what amount would appear in the Non-Controlling Interest Account on the Consolidated Balance Sheet on the date of acquisition if the Proprietary Method were used?
A)$200,000
B)Nil
C)$120,000
D)$100,000

Question

The following data pertains to questions 
Parent and Sub Inc had the following balance sheets on July 31,2007:  The Net Incomes for Parent and Sub Inc for the year ended July 31,2007 were $120,000 and $60,000 respectively.
-Assuming that Parent Inc acquires 80% of Sub Inc,what amount would appear in the Non-Controlling Interest Account on the Consolidated Balance Sheet on the date of acquisition if the Proprietary Method were used?
A)$200,000 
B)Nil 
C)$120,000 
D)$100,000

Quizplus · Accepted Answer

Under the Proprietary Method, the Non-Controlling Interest is not recognized on the consolidated balance sheet.

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