If Smith's Net Income Is $100,000 in the Year Following

question 62

Multiple Choice

If Smith's net income is $100,000 in the year following the acquisition,

• A) the portion allocated to the common stock (residual amount) is $92,800.
• B) $10,800 preferred stock dividend will be subtracted from net income attributed to common stock in arriving at noncontrolling interest in subsidiary income.
• C) the noncontrolling interest balance will be $27,200.
• D) the preferred stock dividend will be ignored in noncontrolling interest in subsidiary net income because Nichols owns the noncontrolling interest of preferred stock.
• E) the noncontrolling interest in subsidiary net income is $30,800.

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