Park Incorporated purchased a 70% interest in Silk Company in 2012 at book value.On January 1,2014,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 2014 and $200,000 in 2015.
Required:
1.Assume Park sold the equipment to Silk.
A.Prepare the consolidating worksheet entries for the equipment for 2014 and 2015.
B.Calculate the noncontrolling interest share in Silk's income for 2014 and 2015.
2.Assume that Silk sold the equipment to Park.
A.Prepare the consolidating worksheet entries for the equipment for 2014 and 2015.
B.Calculate the noncontrolling interest share in Silk's income for 2014 and 2015.

Question

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The Answer of Park Incorporated purchased a 70% interest in Silk Company in 2012 at book value.On January 1,2014,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 2014 and $200,000 in 2015.
Required:
1.Assume Park sold the equipment to Silk.
A.Prepare the consolidating worksheet entries for the equipment for 2014 and 2015.
B.Calculate the noncontrolling interest share in Silk's income for 2014 and 2015.
2.Assume that Silk sold the equipment to Park.
A.Prepare the consolidating worksheet entries for the equipment for 2014 and 2015.
B.Calculate the noncontrolling interest share in Silk's income for 2014 and 2015.

Park Incorporated Purchased a 70% Interest in Silk Company in 2012