On January 1, 2011, Pinnead Incorporated Paid $300,000 for an 80

question 7

Essay

On January 1, 2011, Pinnead Incorporated paid $300,000 for an 80% interest in Shalle Company.At that time, Shalle's total book value was $300,000.Patents were undervalued in the amount of $10,000.Patents had a 5-year remaining useful life, and any remaining excess value was attributed to goodwill.The income statements for the year ended December 31, 2011 of Pinnead and Shalle are summarized below:
Requirements:
1.Calculate the goodwill that will appear in the consolidated balance sheet of Pinnead and Subsidiary at December 31, 2011.
2.Calculate consolidated net income for 2011.
3.Calculate the noncontrolling interest share for 2011.

---

Definitions:

Scalp

The scalp is the anatomical area bordered by the face at the front, and by the neck at the sides and back, comprised of five layers and containing hair follicles and sebaceous glands.

Skin

The largest organ of the body that acts as a barrier protecting against physical, thermal, and chemical injury, and pathogens.

Olfactory Nerves

The first pair of cranial nerves, responsible for the sense of smell.

Trochlear Nerves

The fourth pair of cranial nerves, responsible for eye movement, particularly the superior oblique muscle's function which controls downward and inward eye movement.