Pigeon Corporation Acquired an 80% Interest in Statue Company on January

question 3

Multiple Choice

Pigeon Corporation acquired an 80% interest in Statue Company on January 1,2014,for $90,000 cash when Statue had Capital Stock of $60,000 and Retained Earnings of $40,000.The fair value/book value differential of $12,500 was attributable to equipment with a 10-year (straight-line) life.Statue suffered a $10,000 net loss in 2014 and paid no dividends.At year-end 2014,Statue owed Pigeon $18,000 on account.Pigeon's separate income for 2011 was $150,000.Controlling interest share of consolidated net income for 2014 was

• A)$140,000.
• B)$141,000.
• C)$142,000.
• D)$150,000.

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Definitions:

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A condition where tissue, such as part of the intestine, protrudes through a weakened spot in the abdominal muscles near the groin area.

Strabismus

A condition where the eyes do not properly align with each other when looking at an object, commonly known as crossed eyes.

Binocularity

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