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On January 1, 2020, French Company acquired 60 percent of K-Tech Company for $313,500 when K-Tech’s...

On January 1, 2020, French Company acquired 60 percent of K-Tech Company for $313,500 when K-Tech’s book value was $413,500. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $209,000. At the acquisition date, K-Tech's trademark (20-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (10-year remaining life) was undervalued by $29,000.

In 2020, K-Tech reports $25,500 net income and declares no dividends. At the end of 2021, the two companies report the following figures (stockholders’ equity accounts have been omitted):

French Company
Carrying Amounts		 K-Tech Company
Carrying Amounts		 K-Tech Company
Fair Values
  Current assets $ 629,000 $ 309,000 $ 329,000
  Trademarks 269,000 209,000 289,000
  Patented technology 419,000 159,000 188,000
  Liabilities (399,000 ) (129,000 ) (129,000 )
  Revenues (909,000 ) (409,000 )
  Expenses 491,000 309,000
  Investment income Not given

What is the 2021 consolidated net income before allocation to the controlling and noncontrolling interests?

In 2021, assuming K-Tech has declared no dividends, what are the noncontrolling interest’s share of the subsidiary’s income and the ending balance of the noncontrolling interest in the subsidiary?

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ekkarill92 answered 8 months ago
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