Norman Ltd How Much Is the Non-Controlling Interest Adjusted for Its Share

Multiple Choice

Norman Ltd. owns 60% of the outstanding common shares of Arnie Ltd. During 2013, sales from Arnie to Norman were $200,000. Merchandise was priced to provide Arnie with a gross margin of 20%. Norman's inventories contained $40,000 at December 31, 2012 and $15,000 at December 31, 2013 of merchandise purchased from Arnie. Cost of goods sold for Norman and Arnie for 2013 on their separate-entity income statements were as follows: $\begin{array}{|l|r|r|} \hline& \text { Norman } & \text { Arnie } \\\hline \text { Beginning inventory } & \$ 100,000 & \$ 50,000 \\\hline \text { Purchases } & 700,000 & 200,000 \\\hline \text { Ending inventory } & (110,000) & (55,000) \\\hline \text { Cost of goods sold } & \$ 690,000 & \$ 195,000 \\\hline\end{array}$ How much is the non-controlling interest adjusted for its share of the consolidated net income for the year ended December 31, 2013?

A) $3,000.
B) $5,000.
C) $1,250.
D) $2,000.