Deck 9: Indirect and Mutual Holdings

Question 1

Use the following information to answer the question(s)below.
Pace Corporation owns 70% of Abaza Corporation and 60% of Babon Corporation.Abaza Corporation owns 20% of Babon Corporation.Pace's investment in Abaza was consummated in one transaction at a purchase price $20,000 in excess of the book value.Pace's purchase of Babon was made in one transaction at a price $30,000 above book value.Abaza's investment in Babon was completed in one transaction at a purchase price $10,000 in excess of the book value.The purchase price differential for all three investments was attributable to goodwill.(There were no fair value/book value differences in assets and liabilities for each investment. )Pace's separate net income for the current year is $100,000.Abaza's separate net income is $190,000,which includes a $10,000 unrealized loss on the sale of land to Pace.Babon's separate net income is $150,000.Separate net incomes exclude investment income.
The controlling interest share of consolidated net income for the current year is

A)$341,000.
B)$348,400.
C)$351,000.
D)$355,000.

Answer 1

C
Explanation: C)
Pace Abaza Babon
Separate incomes $100,000 $190,000 $150,000
Plus: Unrealized loss on
land sale to Pace ________ 10,000 ________
Separate realized incomes $100,000 $200,000 $150,000
Allocate Babon's income:
60% to Pace 90,000 (90,000)
20% to Abaza ________ 30,000 (30,000)
Subtotal 190,000 230,000 30,000
Allocate Abaza's net income
to Pace $230,000 × 70% 161,000 (161,000)
Controlling interest share
of consolidated net income $351,000 ________ ________
Noncontrolling interest share $69,000 $30,000

Question 2

Pallet Corporation owns 80% of Adelt Corporation and Adelt owns 60% of Bajo Inc.Which of the following is correct?

A)Bajo should not be consolidated because noncontrolling interests hold 52%.
B)Bajo should be consolidated because the 60% of Bajo stock is held in the affiliate structure.
C)Pallet has 8% indirect ownership of Bajo.
D)Pallet has 80% indirect ownership of Bajo.

Answer 2

B

Question 3

Use the following information to answer the question(s)below.
Paiva Corporation owns 80% of Ackroyd Corporation's outstanding common stock and Ackroyd owns 80% of the outstanding common stock of Bailey Corporation.Bailey Corporation owns 10% of the outstanding common stock of Ackroyd Corporation.The cost of the investments was equal to book value and there were not fair value/book value differences for the investments.The separate net incomes for the three affiliated companies for the year ended December 31,2011 (excluding investment income)are as follows: Paiva Corporation,$100,000,Ackroyd Corporation,$50,000,and Bailey Corporation,$30,000.Use the conventional approach.
Symbols used:
P = Income of Paiva on a consolidated basis
A = Income of Ackroyd on a consolidated basis
B = Income of Bailey on a consolidated basis
Ackroyd's noncontrolling interest share for 2011 is

A)$ 7,609.
B)$ 8,044.
C)$15,652.
D)$23,696.

Answer 3

B
Explanation: B)
P = $100,000 + 0.8A
A = $50,000 + 0.8B
B = $30,000 + 0.1A
A = $50,000 + 0.8 × ($30,000 + 0.1A)
A = $50,000 + $24,000 + 0.08A
0.92A = $74,000
A = $80,435 (rounded)
Noncontrolling interest share
Ackroyd: $80,435 × 10% outside interest $8,044

Question 4

Controlling interest share of consolidated net income for Paint Corporation and Subsidiaries is:

A)$234,800.
B)$244,800.
C)$260,000.
D)$270,000.

Question 5

Raymond Company owns 90% of Rachel Company.Rachel Company owns 10% of Raymond Company.The treasury stock method is used.On the books of Rachel Company,we maintain the Investment in Raymond using the ________ method.The ending balance in Investment in Raymond is ________ stockholders' equity in the consolidated balance sheet.

A)equity;deducted from
B)cost;deducted from
C)treasury stock;deducted from
D)conventional;added to

Question 6

Use the following information to answer the question(s)below.
Pahm Corporation owns 80% of the outstanding voting common stock of Abussi Corporation,which was purchased for $60,000 over Abussi's book value.The excess purchase price was attributable to goodwill.Abussi Corporation owns 60% of the outstanding common stock of Badock Corporation,which was purchased at book value.The separate net incomes of Pahm,Abussi,and Badock (excluding investment income)for the year are $200,000,$240,000,and $260,000,respectively.There were no fair value/book value differences in the assets and liabilities of Pahm,Abussi and Badock.
The amount of income for the current year assigned to the noncontrolling shareholders of Badock Corporation is

A)$100,000.
B)$104,000.
C)$120,000.
D)$140,000.

Question 7

Use the following information to answer the question(s)below.
Paint Corporation owns 82% of Achille Corporation and Achille Corporation owns 80% of Badrack Corporation.For the current year,the separate net incomes (excluding investment income)of Paint,Achille,and Badrack are $120,000,$100,000,and $50,000,respectively.The cost of each investment was equal to the book value of the investment,which was also equal to the fair value.
Noncontrolling interest share for Badrack is

A)$9,000.
B)$10,000.
C)$20,000.
D)$40,000.

Question 8

Pablo Corporation acquired 60% of Abagia Corporation on January 1,2010,at a cost of $20,000 in excess of book value.Also,on July 1,2010,Pablo acquired 60% of Babin Corporation at book value.On January 1,2011,Abagia acquired a 20% interest in Babin at a cost of $10,000 in excess of book value.The excess purchase costs paid by Pablo and Abagia were attributed to goodwill. On July 1,2011,Pablo sold land with a book value of $20,000 to Abagia for $40,000.The $20,000 unrealized gain is included in Pablo's separate income.Separate net incomes for the affiliated companies (excluding investment income)for 2011 are:
Controlling interest share of consolidated net income for 2011 is

A)$304,000.
B)$324,000.
C)$344,000.
D)$364,000.

Question 9

Use the following information to answer the question(s)below.
Pahm Corporation owns 80% of the outstanding voting common stock of Abussi Corporation,which was purchased for $60,000 over Abussi's book value.The excess purchase price was attributable to goodwill.Abussi Corporation owns 60% of the outstanding common stock of Badock Corporation,which was purchased at book value.The separate net incomes of Pahm,Abussi,and Badock (excluding investment income)for the year are $200,000,$240,000,and $260,000,respectively.There were no fair value/book value differences in the assets and liabilities of Pahm,Abussi and Badock.
Controlling interest share of consolidated net income for the current year is

A)$504,800.
B)$516,800.
C)$545,200.
D)$557,200.

Question 10

Use the following information to answer the question(s)below.
Pace Corporation owns 70% of Abaza Corporation and 60% of Babon Corporation.Abaza Corporation owns 20% of Babon Corporation.Pace's investment in Abaza was consummated in one transaction at a purchase price $20,000 in excess of the book value.Pace's purchase of Babon was made in one transaction at a price $30,000 above book value.Abaza's investment in Babon was completed in one transaction at a purchase price $10,000 in excess of the book value.The purchase price differential for all three investments was attributable to goodwill.(There were no fair value/book value differences in assets and liabilities for each investment. )Pace's separate net income for the current year is $100,000.Abaza's separate net income is $190,000,which includes a $10,000 unrealized loss on the sale of land to Pace.Babon's separate net income is $150,000.Separate net incomes exclude investment income.
The amount of noncontrolling interest share for the current year is

A)$69,000.
B)$85,000.
C)$95,000.
D)$99,000.

Question 11

On January 1,2012,Pauline Company acquired 90% of Stephen Company at a cost of $90,000.On January 1,2012,Stephen Company acquired 10% of Pauline Company at a cost of $10,000. On January 1,2012,the following data is available:
At December 31,2012,the following data is available:
Assuming the treasury stock method is used,what elimination entry is needed for the Investment in Pauline at December 31,2012?

A)
B)
C)
D)

Question 12

Use the following information to answer the question(s)below.
Paint Corporation owns 82% of Achille Corporation and Achille Corporation owns 80% of Badrack Corporation.For the current year,the separate net incomes (excluding investment income)of Paint,Achille,and Badrack are $120,000,$100,000,and $50,000,respectively.The cost of each investment was equal to the book value of the investment,which was also equal to the fair value.
Noncontrolling interest share for Achille is

A)$18,000.
B)$25,200.
C)$36,200.
D)$72,000.

Question 13

Use the following information to answer the question(s)below.
Pahm Corporation owns 80% of the outstanding voting common stock of Abussi Corporation,which was purchased for $60,000 over Abussi's book value.The excess purchase price was attributable to goodwill.Abussi Corporation owns 60% of the outstanding common stock of Badock Corporation,which was purchased at book value.The separate net incomes of Pahm,Abussi,and Badock (excluding investment income)for the year are $200,000,$240,000,and $260,000,respectively.There were no fair value/book value differences in the assets and liabilities of Pahm,Abussi and Badock.
The amount of income for the current year assigned to the noncontrolling shareholders of Abussi Corporation is

A)$48,000.
B)$53,200.
C)$74,000.
D)$79,200.

Question 14

Page Corporation acquired a 60% interest in Ace Corporation at a price $40,000 in excess of book value and fair value on January 1,2010.On the same date,Ace acquired a 70% interest in Bader Corporation at a price $30,000 in excess of book value and fair value.The excess purchase cost paid by Page and Ace was attributed to goodwill.Separate net incomes (excluding investment income)for the three affiliates for 2010 are as follows: Page,$500,000,Ace,$300,000,and Bader,$400,000. Page's controlling interest share of consolidated net income for 2010 is

A)$808,000.
B)$848,000.
C)$920,000.
D)$960,000.

Question 15

Pabari Corporation owns an 80% interest in Alders Corporation and Alders owns a 60% interest in Babao Corporation.Both interests were acquired at a cost equal to book value equal to fair value.During 2010,Alders sells land to Babao at a profit of $12,000.Babao still holds the land at December 31,2010.Net income(loss)of the three companies (excluding investment income)for 2010 are: Controlling interest share of consolidated net income and noncontrolling interest share,respectively,for 2010 are

A)$211,200 and ($1,200).
B)$211,200 and ($3,600).
C)$213,600 and ($1,200).
D)$213,600 and ($3,600).

Question 16

Use the following information to answer the question(s)below.
Pahm Corporation owns 80% of the outstanding voting common stock of Abussi Corporation,which was purchased for $60,000 over Abussi's book value.The excess purchase price was attributable to goodwill.Abussi Corporation owns 60% of the outstanding common stock of Badock Corporation,which was purchased at book value.The separate net incomes of Pahm,Abussi,and Badock (excluding investment income)for the year are $200,000,$240,000,and $260,000,respectively.There were no fair value/book value differences in the assets and liabilities of Pahm,Abussi and Badock.
The net income reported for Pahm Corporation for the current year is

A)$504,800.
B)$516,800.
C)$545,200.
D)$557,200.

Question 17

When mutually-held stock involves subsidiaries holding the stock of each other,the ________ method is not used.

A)equity
B)cost
C)conventional
D)treasury stock

Question 18

Use the following information to answer the question(s)below.
Paiva Corporation owns 80% of Ackroyd Corporation's outstanding common stock and Ackroyd owns 80% of the outstanding common stock of Bailey Corporation.Bailey Corporation owns 10% of the outstanding common stock of Ackroyd Corporation.The cost of the investments was equal to book value and there were not fair value/book value differences for the investments.The separate net incomes for the three affiliated companies for the year ended December 31,2011 (excluding investment income)are as follows: Paiva Corporation,$100,000,Ackroyd Corporation,$50,000,and Bailey Corporation,$30,000.Use the conventional approach.
Symbols used:
P = Income of Paiva on a consolidated basis
A = Income of Ackroyd on a consolidated basis
B = Income of Bailey on a consolidated basis
Bailey's noncontrolling interest share for 2011 is

A)$7,609.
B)$8,044.
C)$15,652.
D)$23,696.

Question 19

Use the following information to answer the question(s)below.
Paiva Corporation owns 80% of Ackroyd Corporation's outstanding common stock and Ackroyd owns 80% of the outstanding common stock of Bailey Corporation.Bailey Corporation owns 10% of the outstanding common stock of Ackroyd Corporation.The cost of the investments was equal to book value and there were not fair value/book value differences for the investments.The separate net incomes for the three affiliated companies for the year ended December 31,2011 (excluding investment income)are as follows: Paiva Corporation,$100,000,Ackroyd Corporation,$50,000,and Bailey Corporation,$30,000.Use the conventional approach.
Symbols used:
P = Income of Paiva on a consolidated basis
A = Income of Ackroyd on a consolidated basis
B = Income of Bailey on a consolidated basis
The equation,in a set of simultaneous equations,that computes Paiva Corporation income on a consolidated basis is

A)P = $50,000 + 0.8B.
B)P = $30,000 + 0.2A.
C)P = $100,000 + 0.2A.
D)P = $100,000 + 0.8A.

Question 20

Paglia Corporation owns 80% of Aburn Corporation and has separate net income of $200,000 for 2010.Aburn Corporation has separate net income of $100,000 and owns 70% of the outstanding stock of Badley Corporation.Badley Corporation has separate net income of $80,000.(Separate net incomes exclude investment income. )The cost of each investment was equal to book value and fair value.The controlling interest share of consolidated net income for 2010 is

A)$324,800.
B)$328,800.
C)$344,800.
D)$344,800.

Question 21

Paine Corporation owns 90% of Achan Corporation,Achan Corporation owns 85% of Badge Corporation,and Badge Corporation owns 5% of Achan Corporation.The separate net incomes (excluding investment income)of Paine,Achan,and Badge are $400,000,$160,000,and $220,000,respectively.Assume the investments were acquired at a cost equal to the book value of each investment,which also equals the fair value.
Required:
1.Calculate revised net incomes for Paine,Achan,and Badge by using the conventional method.
2.Determine the controlling interest share of consolidated net income and the noncontrolling interest shares.

Question 22

Paice Corporation owns 80% of the voting common stock of Accardi Corporation.Paice owns 60% of the voting common stock of Badger Corporation.Accardi owns 20% of the voting common stock of Badger.There are no cost/book value/fair value differentials to consider.The separate net incomes (excluding investment income)of these affiliated companies for 2011 are:
Required:
Calculate controlling interest share of consolidated net income and noncontrolling interest shares for Paice Corporation and Subsidiaries for 2011.

Question 23

Padhy Corporation owns 80% of Abrams Corporation,Abrams Corporation owns 60% of Bacud Corporation,and Bacud Corporation owns 10% of Abrams Corporation.The separate net incomes (excluding investment income)of Padhy,Abrams,and Bacud are $300,000,$100,000,and $80,000,respectively.Assume the investments were acquired at a cost equal to the book value of each investment,which also equals the fair value.
Required:
Calculate the controlling interest share of consolidated net income and the noncontrolling interest shares for Padhy Corporation and its subsidiaries.Use the conventional method for your solution.

Question 24

On January 1,2011 Paki Inc.bought 75% interest in Adam Corporation.At the time of purchase,Adam owned 80% of Baird Company.In all acquisitions,the book value equals the fair value,which equals the acquisition cost.Separate earnings (loss)(excluding investment income)for the three affiliates for 2011 are as follows:
Required:
Compute controlling interest share of consolidated net income and noncontrolling interest shares for Paki and affiliates for 2011.

Question 25

Packer Corporation owns 100% of Abel Corporation,Abel Corporation owns 95% of Bacon Corporation and Bacon Corporation owns 80% of Cab Corporation.The separate net incomes (excluding investment income)of Packer,Abel,Bacon,and Cab are $300,000,$100,000,$200,000,and $300,000,respectively.All of the investments were made at times when the investee's book values were equal to their fair values.There were no cost/book value differentials for each investment.
Required:
Determine the controlling interest share of consolidated net income and noncontrolling interest shares for Packer Corporation and Subsidiaries for the current year.

Question 26

On January 1,2011,Singh Company acquired an 80 percent interest in Gonzalez Company for $300,000.On January 1,2011,Gonzalez's total stockholders' equity was $375,000.The fair value and book value of Gonzalez's individual assets and liabilities were equal.
On January 2,2011,Gonzalez Company acquired a 10 percent interest in Singh Company for $50,000.On January 2,2011,Singh's total stockholders' equity was $500,000.The fair value and book value of Singh's individual assets and liabilities were equal.
For the year ending December 31,2011,the following data is available:
The treasury stock method is used to account for the mutual stock holdings between Singh and Gonzalez.The separate net incomes do not include investment income.
Required:
1.What is Gonzalez's income from Singh for 2011?
2.What is Singh's income from Gonzalez for 2011?
3.What is the noncontrolling interest share associated with Gonzalez Company for 2011?
4.Prepare the elimination entry for Gonzalez's Investment in Singh Company.

Question 27

Separate earnings and investment percentages for three affiliates for 2011 are as follows:
Assume the investments were acquired at a cost equal to the book value of each investment,which also equals the fair value.Separate earnings do not include investment income.
Required:
1.Calculate revised net incomes for Palace,Acres,and Bain by using the conventional method.
2.Determine the controlling interest share of consolidated net income and the noncontrolling interest shares.

Question 28

Paik Corporation owns 80% of Acdol Corporation and 60% of Ben Corporation.Acdol Corporation owns 10% of Ben Corporation.All subsidiary investments were acquired at book value.There are no fair value/book value differentials associated with each investment.Separate net incomes (excluding investment income)of the affiliated companies for 2011 are:
Paik: $600,000 which includes $60,000 unrealized losses on inventory items sold to Ben
Acdol: $360,000
Ben: $340,000 which includes $100,000 unrealized profit on land sold to Acdol
Required:
Determine controlling interest share of consolidated net income and noncontrolling interest shares for Paik Corporation and Subsidiaries for 2011.

Question 29

On January 1,2011,Adam Corporation purchased a 90% interest in Rodney Corporation.On January 1,2011,Rodney Corporation purchased an 80% interest in Ben Corporation.
In all investment acquisitions,the cost of the interest was equal to the book value of the interest and the fair value of the interest.The following information is available for 2011:
The separate net incomes do not include investment income.
Required:
1.What is controlling interest share of consolidated net income for 2011?
2.What is noncontrolling interest shares of consolidated net income for 2011?

Question 30

On January 1,2011,Wrobel Company acquired a 90 percent interest in Sally Company for $270,000.On January 1,2011,Sally's total stockholders' equity was $300,000.The fair value and book value of Sally's individual assets and liabilities were equal.
On January 2,2011,Sally Company acquired a 10 percent interest in Wrobel Company for $70,000.On January 2,2011,Wrobel's total stockholders' equity was $700,000.The fair value and book value of Wrobel's individual assets and liabilities were equal.
For the year ending December 31,2011,the following data is available:
The treasury stock method is used to account for the mutual stock holdings between Wrobel and Sally.The separate net incomes do not include investment income.
Required:
1.What is Sally's income from Wrobel for 2011?
2.What is Wrobel's income from Sally for 2011?
3.What is the noncontrolling interest share associated with Sally Company for 2011?
4.Prepare the elimination entry for Sally's Investment in Wrobel Company.

Question 31

Pacini Corporation owns an 80% interest in Abdoo Corporation,acquired on January 1,2010 for $700,000 when Abdoo's stockholders' equity consisted of $600,000 of Capital Stock and $200,000 of Retained Earnings.
Abdoo Corporation acquired a 60% interest in Bach Corporation on July 1,2010 for $180,000 when Bach had Capital Stock of $200,000 and Retained Earnings of $50,000.On January 1,2011,Abdoo acquired a 70% interest in Cabo Corporation for $270,000 when Cabo had Capital Stock of $250,000 and Retained Earnings of $100,000.
No change in outstanding stock of any of the affiliated companies has occurred since the investments were made.All cost-book value differentials are goodwill.There are no fair value/book value differentials.The stockholders' equity section of the separate balance sheets of Abdoo,Bach,and Cabo at December 31,2011 are as follows:
Required:
1.Compute the amount at which goodwill should be shown in the consolidated balance sheet of Pacini Corporation and Subsidiaries at December 31,2011.
2.Pacini and Abdoo have applied the equity method correctly.Determine the balances of the three investment accounts at December 31,2011.

Question 32

On January 1,2011,Wrobel Company acquired a 90 percent interest in Sally Company for $270,000.On January 1,2011,Sally's total stockholders' equity was $300,000.The fair value and book value of Sally's individual assets and liabilities were equal.
On January 2,2011,Sally Company acquired a 10 percent interest in Wrobel Company for $70,000.On January 2,2011,Wrobel's total stockholders' equity was $700,000.The fair value and book value of Wrobel's individual assets and liabilities were equal.
For the year ending December 31,2011,the following data is available:
The treasury stock method is used to account for the mutual stock holdings between Wrobel and Sally.The separate net incomes do not include investment income.
A partial working paper is available for the year ending December 31,2011.
Required:
Prepare the elimination entries for the year ending December 31,2011.
Do not enter them onto the worksheet.Instead,list them below.

Question 33

On January 1,2011,Singh Company acquired an 80 percent interest in Gonzalez Company for $300,000.On January 1,2011,Gonzalez's total stockholders' equity was $375,000.The fair value and book value of Gonzalez's individual assets and liabilities were equal.
On January 2,2011,Gonzalez Company acquired a 10 percent interest in Singh Company for $50,000.On January 2,2011,Singh's total stockholders' equity was $500,000.The fair value and book value of Singh's individual assets and liabilities were equal.
For the year ending December 31,2011,the following data is available:
The treasury stock method is used to account for the mutual stock holdings between Singh and Gonzalez.The separate net incomes do not include investment income.A partial consolidating worksheet is below.
Required:
Prepare the elimination entries for the year ending December 31,2011.
Do not enter them onto the worksheet.Instead,list them below.

Question 34

On January 1,2011,Peabody Corporation acquired a 90% interest in Salisbury Company for $270,000 when Salisbury's stockholders' equity was $300,000;with Common stock $200,000 and Retained earnings $100,000.
On January 1,2011,Salisbury purchased a 10% interest in Peabody for $70,000 when Peabody's total stockholders' equity was $700,000;with Common stock $500,000 and Retained earnings $200,000.
The following data was available for the year ending December 31,2011:
Use the conventional approach to account for the mutually-held stock.Assume there were no book value/fair value differentials for each investment.The separate net incomes do not include investment income.
Required:
1.Prepare the journal entry for Peabody on January 1,2011.
2.Prepare the journal entry for Salisbury on January 1,2011.
3.Prepare the journal entry to record the constructive retirement of 10% of Peabody's outstanding stock due to Salisbury's purchase of Peabody's stock.
4.Determine the incomes of Peabody and Salisbury on a consolidated basis with mutual income for 2011 using simultaneous equations.
5.What is controlling interest share of consolidated net income and noncontrolling interest shares for 2011?

Question 35

Paco Corporation owns 90% of Aber Corporation,Aber Corporation owns 85% of Back Corporation,and Back Corporation owns 5% of Aber Corporation.The separate net incomes (excluding investment income)of Paco,Aber,and Back are $100,000,$40,000,and $55,000,respectively.Assume the investments were acquired at a cost equal to the book value of each investment,which also equals the fair value.
Required:
1.Calculate revised net incomes for Paco,Aber,and Back by using the conventional method.
2.Determine the controlling interest share of consolidated net income and the noncontrolling interest shares.

Question 36

On January 1,2011,Klode Corporation acquired an 80% interest in Savy Company for $400,000 when Savy's stockholders' equity was $500,000;with Common stock $400,000 and Retained earnings $100,000.
On January 1,2011,Savy purchased a 10% interest in Klode for $50,000 when Klode's total stockholders' equity was $500,000;with Common stock $400,000 and Retained earnings $100,000.
The following data was available for the year ending December 31,2011:
Use the conventional approach to account for the mutually-held stock.Assume there were no book value/fair value differentials for each investment.The separate net incomes do not include investment income.
Required:
1.Prepare the journal entry for Klode on January 1,2011.
2.Prepare the journal entry for Savy on January 1,2011.
3.Prepare the journal entry to record the constructive retirement of 10% of Klode's outstanding stock due to Savy's purchase of Klode's stock.
4.Determine the incomes of Klode and Savy on a consolidated basis with mutual income for 2011 using simultaneous equations.
5.What is controlling interest share of consolidated net income and noncontrolling interest shares for 2011?

Question 37

On January 1,2011,Paul Corporation acquired a 90% interest in Satorius Company for $360,000 when Satorius' stockholders' equity was $400,000;with Common stock $200,000 and Retained earnings $200,000.
On January 1,2011,Satorius Company purchased a 10% interest in Paul Company for $90,000 when Paul's total stockholders' equity was $900,000;with Common stock $500,000 and Retained earnings $400,000.
The following data was available for the year ending December 31,2011:
Use the conventional approach to account for the mutually-held stock.Assume there were no book value/fair value differentials for each investment.The separate net incomes do not include investment income.
Required:
1.Prepare the journal entry for Paul on January 1,2011.
2.Prepare the journal entry for Satorius on January 1,2011.
3.Prepare the journal entry to record the constructive retirement of 10% of Paul's outstanding stock due to Satorius' purchase of Paul's stock.
4.Determine the incomes of Paul and Satorius on a consolidated basis with mutual income for 2011 using simultaneous equations.
5.What is controlling interest share of consolidated net income and noncontrolling interest shares for 2011?
6.What is consolidated net income?