REFERENCE: Ref.07_17 On January 1,2009,Maurice Co.acquired 75% of Lawrence Co.'s Outstanding Common

question 41

Essay

REFERENCE: Ref.07_17
On January 1,2009,Maurice Co.acquired 75% of Lawrence Co.'s outstanding common stock.On the same date,Lawrence acquired an 80% interest in Curleton Co.Both of these investments were accounted using the initial value method.No dividends were distributed by either Lawrence or Curleton during 2009 or 2010.Maurice paid cash dividends each year equal to 40% of operating income.Reported operating income totals for 2009 were as follows: Following are the 2010 financial statements for these three companies.Curleton made numerous transfers of inventory to Lawrence since the takeover: $112,000 (2009)and $140,000 (2010).These transactions included the same markup applicable to Curleton's outside sales.In each of these years,Lawrence carried 20% of this inventory into the succeeding year before disposing of it.
An effective income tax rate of 45% was applicable to all companies.
I can't edit picture.Need to change the three years in the schedules - each from 2007 to 2010 The years should be 2010 instead of 2007 in this table
-Required:
Determine the noncontrolling interest in Lawrence Co.'s net income.

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