Use the following information for Questions 17 & 18:
P Company owns an 80% interest in S Company.During 2014, S sells merchandise to P for $200,000 at a profit of $40,000.On December 31, 2014, 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 2014 is:
A)$300,000.
B)$380,000.
C)$396,000.
D)$420,000.

Question

Use the following information for Questions 17 & 18:
P Company owns an 80% interest in S Company.During 2014, S sells merchandise to P for $200,000 at a profit of $40,000.On December 31, 2014, 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 2014 is:
A)$300,000. 
B)$380,000. 
C)$396,000. 
D)$420,000.

Quizplus · Accepted Answer

Controlling interest in consolidated net income is calculated by subtracting the non-controlling interest from the total consolidated net income. The correct calculation results in $380,000.

Use the Following Information for Questions 17 & 18