Bell company acquires 80 percent of demers company for

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Reference no: EM13370408

Bell Company acquires 80 percent of Demers Company for $500,000 on 1st January, 2009. Demers reported common stock of $300,000 and retained earnings of $200,000 on that date. Equipment was undervalued by $30,000 and buildings were undervalued by $40,000, each having a 10-year remaining life. Any excess consideration transferred over fair value was attributed to goodwill with an indefinite life. Based on an annual review, goodwill has not been impaired.

Demers earns income and pays dividends as given:

Suppose the initial method is applied.

Find how much does Bell report as Income from Demers for the year ended 31st December, 2011?

a. $48,000
b. $56,000
c. $98,400
d. $97,000
e. $50,400

Calculate the non-controlling interest of Demers at 31st December, 2011.

a. $107,800
b. $140,000
c. $80,000
d. $50,000
e. $160,800

Reference no: EM13370408

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