Company A owns 85 percent of Company B's stock and 80 percent of Company C's stock. All acquisitions were made at book value. The fair values of noncontrolling interests at the time of acquisition were equal to the proportionate share of the book values of the companies. The companies file a consolidated tax return each year and in 20X9 paid a total tax of $112,000. Each company is involved in a number of intercompany inventory transfers each period. Information on the companies' activities for 20X9 is as follows: Company A does not record income tax expense on income from subsidiaries because a consolidated tax return is filed.
Based on the information provided, income to the controlling interest for 20X9 is:
A) $155,370.
B) $56,000.
C) $168,000.
D) $250,000.

Question

Company A owns 85 percent of Company B's stock and 80 percent of Company C's stock. All acquisitions were made at book value. The fair values of noncontrolling interests at the time of acquisition were equal to the proportionate share of the book values of the companies. The companies file a consolidated tax return each year and in 20X9 paid a total tax of $112,000. Each company is involved in a number of intercompany inventory transfers each period. Information on the companies' activities for 20X9 is as follows:  Company A does not record income tax expense on income from subsidiaries because a consolidated tax return is filed.
Based on the information provided, income to the controlling interest for 20X9 is:
A) $155,370. 
B) $56,000. 
C) $168,000. 
D) $250,000.

Quizplus · Accepted Answer

The Answer of Company A owns 85 percent of Company B's stock and 80 percent of Company C's stock. All acquisitions were made at book value. The fair values of noncontrolling interests at the time of acquisition were equal to the proportionate share of the book values of the companies. The companies file a consolidated tax return each year and in 20X9 paid a total tax of $112,000. Each company is involved in a number of intercompany inventory transfers each period. Information on the companies' activities for 20X9 is as follows:  Company A does not record income tax expense on income from subsidiaries because a consolidated tax return is filed.
Based on the information provided, income to the controlling interest for 20X9 is:
A) $155,370. 
B) $56,000. 
C) $168,000. 
D) $250,000.

Company a Owns 85 Percent of Company B's Stock and 80