On April 1, Pujols, Inc., exchanges $583,250 fair-value consideration for 70 per

Question

On April 1, Pujols, Inc., exchanges $583,250 fair-value consideration for 70 percent of the outstanding stock of Ramirez Corporation. The remaining 30 percent of the outstanding shares continued to trade at a collective fair value of $200,250. Ramirez’s identifiable assets and liabilities each had book values that equaled their fair values on April 1 for a net total of $587,500. During the remainder of the year, Ramirez generates revenues of $767,000 and expenses of $441,000 and declared no dividends. On a December 31 consolidated balance sheet, what amount should be reported as noncontrolling interest?

Explanation / Answer

Net assets in beginning of the year     587,500 Net value generated during the year Revenue     767,000 Less expense (441,000) Total Net asset at the end of year     913,500 Non controlling interest 30% Non controlling interest     274,050

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