Paine Corporation Owns 90% of Achan Corporation,Achan Corporation Owns 85

Essay

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.