Page Company Purchased an 80% Interest in the Common Stock

question 10

Multiple Choice

Page Company purchased an 80% interest in the common stock of the Seed Company for $600,000 on January 1, 2019, when Seed Company had the following stockholders' equity:
$$\begin{array} { l r } \text { Common stock, } \$ 10 \text { par } & \$ 300,000 \\\text { Cumulative preferred stock, } 10 \% , \$ 10 \text { par } & 100,000 \\\text { Paid-in excess of par, common } & 50,000 \\\text { Retained earnings } & 200,000\end{array}$$ Any excess of cost over book value on the common stock purchase was attributed to goodwill.Page does not hold any of Seed's preferred stock.Seed had net income of $40,000 during 2019 and paid no dividends.

The preferred stock is two years in arrears on January 1, 2019.The non-controlling interest share of 2019 net income was ____.

• A)$3,200
• B)$6,000
• C)$8,000
• D)$16,000

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Definitions:

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Male reproductive cells or gametes in sexually reproducing organisms, designed to fertilize female eggs.

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Physical or behavioral traits of an organism that differentiate between males and females, often involved in reproductive processes.

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A physiological response in which erectile tissues, primarily in the penis, become engorged with blood, leading to increased rigidity and size.

Gametes

Gametes are the cells used during sexual reproduction to produce a new individual, typically having half the chromosome number of other cells.