Catalyst Corporation acquired 90 percent of Trigger Corporation's common stock on September 30,2008 for $225,000.At that date,the fair value of the noncontrolling interest was $25,000.On January 1,2008,Trigger reported the following stockholders' equity balances:
Trigger reported net income of $80,000 in 2008,earned uniformly throughout the year,and declared and paid dividends of $10,000 on June 30 and $30,000 on December 31,2008.Catalyst reported retained earnings of $250,000 on January 1,2008,and had 2008 income of $120,000 from its separate operations.Catalyst paid dividends of $50,000 on December 31,2008.Catalyst accounts for its investment in Trigger Corporation using the basic equity method.

-Based on the information provided,what is the consolidated net income reported for the year 2008?
A)$120,000
B)$138,000
C)$140,000
D)$192,000

Question

Catalyst Corporation acquired 90 percent of Trigger Corporation's common stock on September 30,2008 for $225,000.At that date,the fair value of the noncontrolling interest was $25,000.On January 1,2008,Trigger reported the following stockholders' equity balances:
Trigger reported net income of $80,000 in 2008,earned uniformly throughout the year,and declared and paid dividends of $10,000 on June 30 and $30,000 on December 31,2008.Catalyst reported retained earnings of $250,000 on January 1,2008,and had 2008 income of $120,000 from its separate operations.Catalyst paid dividends of $50,000 on December 31,2008.Catalyst accounts for its investment in Trigger Corporation using the basic equity method.
 
-Based on the information provided,what is the consolidated net income reported for the year 2008?
A)$120,000 
B)$138,000 
C)$140,000 
D)$192,000

Quizplus · Accepted Answer

The correct consolidated net income reported for the year 2008 is $140,000.

Catalyst Corporation Acquired 90 Percent of Trigger Corporation's Common Stock