Answer both a and b.if answered within 45mins,it would be a great help!! Problem #1 Calculation of Consolidated Net Income & NCI share (Based on P4-14):Drago company acquired 60% of Sago's for $300,000 when Sago's book value was $400,000. The Non-controllinginterest had an assessed fair value of $200,000. At the acquisition date, Sago had a trademark (with 10-year remaininglife) that was undervalued in the financial records by $60,000. Also, patented technology with a 5-year remaining lifewas undervalued by $40,000. Two years later, the following figures are reported by the two companies.Dago Company BookSago CompanySago CompanyValueBook ValueFair ValueCurrent Assets$620,000$260,000$410,000($390,000)($900,000)$500,000$300,000$200,000$320,000$280,000TrademarkPatented Technology$150,000$150,000($120,000)($120,000)($400,000)$300,000LiabilitiesRevenuesExpensesRequired:a) Calculate the consolidated net income before allocation to the controlling and non-controlling interest (note:you must deduct the amortization for the current year)b) Calculate the non-controlling interest's share of the subsidiary's incomeProblem #2 Calculation of annual amortization and investment balances (Based on P5-17)

Definition: Consolidated financial statements: When an investor company holds above 50% in the…

Problem #1 Calculation of Consolidated Net Income & NCI share (Based on P4-14): Drago company acquired 60% of Sago's for $300,000 when Sago's book value was $400,000. The Non-controlling interest had an assessed fair value of $200,000. At the acquisition date, Sago had a trademark (with 10-year remaining life) that was undervalued in the financial records by $60,000. Also, patented technology with a 5-year remaining life was undervalued by $40,000. Two years later, the following figures are reported by the two companies. Dago Company Book Sago Company Book Value $300,000 $200,000 $150,000 ($120,000) ($400,000) $300,000 Sago Company Fair Value $320,000 $280,000 $150,000 ($120,000) Value Current Assets Trademark Patented Technology $620,000 $260,000 $410,000 Liabilities Revenues Expenses |($390,000) |($900,000) $500,000 Required: a) Calculate the consolidated net income before allocation to the controlling and non-controlling interest (note: you must deduct the amortization for the current year) b) Calculate the non-controlling interest's share of the subsidiary's income

Problem #1 Calculation of Consolidated Net Income & NCI share (Based on P4-14): Drago company acquired 60% of Sago's for $300,000 when Sago's book value was $400,000. The Non-controlling interest had an assessed fair value of $200,000. At the acquisition date, Sago had a trademark (with 10-year remaining life) that was undervalued in the financial records by $60,000. Also, patented technology with a 5-year remaining life was undervalued by $40,000. Two years later, the following figures are reported by the two companies. Dago Company Book Sago Company Book Value $300,000 $200,000 $150,000 ($120,000) ($400,000) $300,000 Sago Company Fair Value $320,000 $280,000 $150,000 ($120,000) Value Current Assets Trademark Patented Technology $620,000 $260,000 $410,000 Liabilities Revenues Expenses |($390,000) |($900,000) $500,000 Required: a) Calculate the consolidated net income before allocation to the controlling and non-controlling interest (note: you must deduct the amortization for the current year) b) Calculate the non-controlling interest's share of the subsidiary's income

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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