On April 1, Boston, Inc., exchanges $633,750 fair-value consideration for 70 per

Question

On April 1, Boston, Inc., exchanges $633,750 fair-value consideration for 70 percent of the outstanding stock of Framingham Corporation. The remaining 30 percent of the outstanding shares continued to trade at a collective fair value of $229,650. Framingham’s identifiable assets and liabilities each had book values that equaled their fair values on April 1 for a net total of $712,500. During the remainder of the year, Framingham generates revenues of $680,000 and expenses of $455,000 and declared no dividends. On a December 31 consolidated balance sheet, what amount should be reported as noncontrolling interest?

A. $280,275.

B. $339,110.

C. $297,150.

D. $281,250.

Explanation / Answer

Non controlling interest as on 1 april = 229650

Profit earned during the remainder year = 680000-455000 = 225000

Share of non controlling holders in the profit during the year = 225000 * 30%= 67500

Non controlling interest as on 31 dec = 229650 + 67500= 297150

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.