Gargiulo Company, a 90% Owned Subsidiary of Posito Corporation, Sells

Multiple Choice

Gargiulo Company, a 90% owned subsidiary of Posito Corporation, sells inventory to Posito at a 25% profit on selling price. The following data are available pertaining to intra-entity purchases. Gargiulo was acquired on January 1, 2010.

Assume the equity method is used. The following data are available pertaining to Gargiulo's income and dividends.

Compute the non-controlling interest in Gargiulo's net income for 2011.

A) $8,500.
B) $8,570.
C) $8,430.
D) $8,400.
E) $7,580.