Femur Co Acquired 70% of the Voting Common Stock of Harbor

question 74

Multiple Choice

Femur Co. acquired 70% of the voting common stock of Harbor Corp. on January 1, 2010. During 2010, Harbor had revenues of $2,500,000 and expenses of $2,000,000. The amortization of excess cost allocations totaled $60,000 in 2010.
-The noncontrolling interest's share of the earnings of Harbor Corp. is calculated to be

• A) $132,000.
• B) $150,000.
• C) $168,000.
• D) $160,000.
• E) $0.

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Definitions:

Credit

An accounting entry that either increases a liability or equity account, or decreases an asset or expense account. It is also used to refer to the provision of resources by a credit provider to a borrower.

Expenses

Costs incurred in the process of earning revenues, generally categorized as operating or non-operating.

Debit

An accounting entry that increases assets or expenses or decreases liabilities, equity, or revenue.

Credit

The granting of a loan and the creation of debt; any form of deferred payment.