On January 1, 2021, Nichols Company Acquired 80% of Smith

Multiple Choice

On January 1, 2021, Nichols Company acquired 80% of Smith Company's common stock and 40% of its non-voting, cumulative preferred stock. The consideration transferred by Nichols was $1,200,000 for the common and $124,000 for the preferred. There was no premium in the value of consideration transferred. Any excess acquisition-date fair value over book value is considered goodwill. The capital structure of Smith immediately prior to the acquisition is: Compute the noncontrolling interest in Smith at date of acquisition.

A) $486,000.
B) $480,000.
C) $300,000.
D) $150,000.
E) $120,000.