In: Accounting
A) Stayer's Building (Net of Accum. Depreciation) :-
Depreciation = Fair Value at Acquisition date / Remaining Life
= $345000 / 10 years
= $34500
Value of Building on Dec. 31, 2018 (after Depreciation) = $345000 - $34500
= $310500
B) Value of Technology Processes :-
amortization for 2018 = Fair value at Acquisition date / Remaining Life
= $1000000 / 20 years
= $50000
Value of Technology Processes = Fair Value at Acquisition date - Amortization for 2018
= $1000000 - $50000
= $950000
C) Calculation for Net Income Attributable to non-Controlling interest :-
Particulars | Amount($) |
Company Stayer's Reported Earnings | 350000 |
Less : Excess fair Value Amortization :- | |
Technology Process | (50000) |
Building (($345000-$195000)/10) | (15000) |
Company Stayer's Adjusted Earnings | 285000 |
Non-controlling interest in Company Stayer's Earnings | *20% |
Net Income Attributable to non-controlling interest | 57000 |
D). Net Income Attributable to Controlling Interest :-
Particulars | Amount($) | Amount($) |
Johnsonville's Net Income | 650000 | |
Stayer's Earnings | 350000 | |
Less : Excess fair value amortization ;- | ||
Technology Process | (50000) | |
Building (Above) | (15000) | |
Stayer's Adjused Earnings | 285000 | |
Johnsonville's share in Stayer's Earnings(285000*80%) | 228000 | |
Net Income attributable to controlling Interest | 878000 |
E) Non-Controlling Interest in Stayer :-
Particulars | Amount($) |
Fair Value of Stayer on acquisition ($3000000/80%) | 3750000 |
Non-Controlling Interest ($3750000*20%) | 750000 |
Add : Non-Controlling Interest in Net income | 57000 |
Less : Non-Controlling Interest in Dividend ($50000*20%) | (10000) |
Non-Controlling Interest on Dec.31, 2018 | 797000 |