Presto Inc. acquired 75% outstanding ordinary shares of Sun Corp. Presto regularly sells inventory to Sun Corp with profit. The computation of non-controlling interest in net income will be: Group of answer choices A. (Net income of subsidiary – realized profit in beginning inventory + unrealized profit in ending inventory) x 25% B. (Net income of subsidiary + amortization of overvalued assets – amortization of undervalued assets + realized profit in beginning inventory – unrealized profit in ending inventory) x 25% C. (Net income of subsidiary + amortization of overvalued assets – amortization of undervalued assets) x 25% D. (Net income of subsidiary + realized profit in beginning inventory – unrealized profit in ending inventory) x 25%

Presto Inc. acquired 75% outstanding ordinary shares of Sun Corp. Presto regularly sells inventory to Sun Corp with profit. The computation of non-controlling interest in net income will be: Group of answer choices A. (Net income of subsidiary – realized profit in beginning inventory + unrealized profit in ending inventory) x 25% B. (Net income of subsidiary + amortization of overvalued assets – amortization of undervalued assets + realized profit in beginning inventory – unrealized profit in ending inventory) x 25% C. (Net income of subsidiary + amortization of overvalued assets – amortization of undervalued assets) x 25% D. (Net income of subsidiary + realized profit in beginning inventory – unrealized profit in ending inventory) x 25%

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter20: Corporations: Distributions In Complete Liquidation And An Overview Of Reorganizations

Section: Chapter Questions

Problem 35P

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