IV. Pam Corporation acquired a 90 percent interest in Sun Corporation on July 1, 2017, for$675,000. The stockholders' equity of Sun at December 31, 2016, was as follows (inthousands):Capital stock$500Retained earnings200Total$700During 2017 and 2018, Sun reported income and declared dividends as follows:20172018Net Income$100,000$80,000Dividends (December 1)50,00030,000On July 1, 2018, Pam sold a 10 percent interest (or one-ninth of its investment) in Sun for$85,000. (Go go next page)Required: (30%)1. Determine Pam's investment income for 2017 and 2018, and its investment balance onDecember 31, 2017 and 2018.2. Determine noncontrolling interest share for 2017 and 2018, and the total of noncontrollinginterest on December 31, 2017 and 2018.3. Prepare the entries for 2018 under equity method.(The End)

Pam Corporation acquired 90% interest in Sun Corporation on July 1, 2017 for $ 675,000. The…

Required: (30%) 1. Determine Pam's investment income for 2017 and 2018, and its investment balance on December 31, 2017 and 2018. 2. Determine noncontrolling interest share for 2017 and 2018, and the total of noncontrolling interest on December 31, 2017 and 2018. 3. Prepare the entries for 2018 under equity method. (The End)

Required: (30%) 1. Determine Pam's investment income for 2017 and 2018, and its investment balance on December 31, 2017 and 2018. 2. Determine noncontrolling interest share for 2017 and 2018, and the total of noncontrolling interest on December 31, 2017 and 2018. 3. Prepare the entries for 2018 under equity method. (The End)

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 24E

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