P Company owns 90% of the outstanding common stock of S Company and 85% of the outstanding common stock of T Company. S Company owns 10% of the outstanding common stock of T Company. For 2006, each company had $100,000 of earnings from its own separate operations, exclusive of earnings on its investments in affiliates and amortization of cost in excess of book value. For 2006, P Company had amortization of cost in excess of book value of $4,000 relating to S Company and $2,000 relating to T Company.
Required:
Determine the consolidated net income for 2006 that accrues to the controlling interest.

Question

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The Answer of P Company owns 90% of the outstanding common stock of S Company and 85% of the outstanding common stock of T Company. S Company owns 10% of the outstanding common stock of T Company. For 2006, each company had $100,000 of earnings from its own separate operations, exclusive of earnings on its investments in affiliates and amortization of cost in excess of book value. For 2006, P Company had amortization of cost in excess of book value of $4,000 relating to S Company and $2,000 relating to T Company.
Required:
Determine the consolidated net income for 2006 that accrues to the controlling interest.

P Company Owns 90% of the Outstanding Common Stock of S