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    Cozzy Pawer
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    POP Corporation acquired an 80% interest in Son Corporation on January 1, 2017 for $1,200,000. Son's equity at the time consisted of $1,000,000 in common stock and $400,000 in retained earnings. The consolidated income statement for POP Corporation and subsidiary Son for the year ending December 31, 2018 shows total sales of $3,000,000, total costs of $1,300,000, and net income attributable to POP, the parent company, of $921,600 after accounting for minority interest in Son.

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    POP Corporation acquired an 80% interest in Son Corporation on January 1, 2017 for $1,200,000. Son's equity at the time consisted of $1,000,000 in common stock and $400,000 in retained earnings. The consolidated income statement for POP Corporation and subsidiary Son for the year ending December 31, 2018 shows total sales of $3,000,000, total costs of $1,300,000, and net income attributable to POP, the parent company, of $921,600 after accounting for minority interest in Son.

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    7 views3 pages

    Questio 1

    Uploaded by

    Cozzy Pawer
    POP Corporation acquired an 80% interest in Son Corporation on January 1, 2017 for $1,200,000. Son's equity at the time consisted of $1,000,000 in common stock and $400,000 in retained earnings. The consolidated income statement for POP Corporation and subsidiary Son for the year ending December 31, 2018 shows total sales of $3,000,000, total costs of $1,300,000, and net income attributable to POP, the parent company, of $921,600 after accounting for minority interest in Son.

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    This solution was written by a subject matter expert. It's designed to help students like you learn
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    Anonymous answered this226 answers

    Answer:

    Given that:

    Consolidated income statement (upstream sales) Pop Corporation purchased an 80 percent


    interest in Son Corporation for $1,200,000 on January 1, 2017, at which time Son's stockholders'
    equity consisted of $1,000,000 common stock and $400,000 retained earnings.

    As per the given information POP corporation has acquired 80%


    interest son corporation as on january 1,2017

    for $1200000

    Consolldated income statement of POP corporation and subsidlary


    for the year ending decmeber 31,2018

    particulars pop son Consolidated

    sales 2000 1000 3000

    Cost of sales -800 -500 -1300

    Depreciation expense -260 -80 -340

    other expense -180 -120 -300

    760 300 1060

    Less: profit element incuded in

    Son which are in stock of pop books 3 3

    706 297 1057

    Less: Dividends declared 60 20 80

    Net profit attributable to

    Shareholds 700 277 977

    Less: Minority interest in net income 55.4 55.4

    Net income attributable to pop,the


    parent company 700 221.6 921.6

    I tried my best to give proper explanation about this question in case of any further explanation
    do comment.
    i will be happy to help you thanks.

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