McLaughlin, Inc. acquires 70 percent of Ellis Corporation on September 1, 2019, and an additional...
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Accounting
McLaughlin, Inc. acquires 70 percent of Ellis Corporation on September 1, 2019, and an additional 10 percent on November 1, 2020. Annual amortization of $12,000 relates to the first acquisition. Ellis reports the following figures for 2020:
Revenues
$
500,000
Expenses
350,000
Retained earnings, 1/1/20
3,500,000
Dividends paid
40,000
Common stock
400,000
Without regard for this investment, McLaughlin earns $480,000 in net income ($840,000 revenues less $360,000 expenses; incurred evenly through the year) during 2020.
Required:
Prepare a schedule of consolidated net income and apportionment to noncontrolling and controlling interests for 2020.
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