Tower Company owns 85% of Hill Company. The two companies engaged in several intra-entity transactions. Each company's operating and dividend income for the current time period follow, as well as the effects of unrealized gains. No income tax accruals have been recognized within these totals. The tax rate for each company is 30%. Compute accrual-based consolidated net income.

Question

Tower Company owns 85% of Hill Company. The two companies engaged in several intra-entity transactions. Each company's operating and dividend income for the current time period follow, as well as the effects of unrealized gains. No income tax accruals have been recognized within these totals. The tax rate for each company is 30%.  Compute accrual-based consolidated net income.

Quizplus · Accepted Answer

Combined Operating Inc ($200,000 + $80,000) $280,000 - Combined I/E Gains ($25,000 + $10,000) $35,000 = Consolidated Income ($245,000)

Tower Company Owns 85% of Hill Company