Question

Presented below are certain account balances of Blossom Products Co. Rent revenue $7,170 Sales discounts $7,950 Interest expense 13,680 Selling expenses 99,450 Beginning retained earnings 114,870 Sales revenue 408,000 Ending retained earnings 134,840 Income tax expense 26,328 Dividend revenue 71,680 Cost of goods sold 184,188 Sales returns and allowances 12,490 Administrative expenses 84,550 Allocation to noncontrolling interest 20,520 From the foregoing, compute the following: (a) total net revenue, (b) net income, (c) income attributable to controlling stockholders, if Blossom has allocation to noncontrolling interest of $20,520.

Answer 1

(A) $466,410

(B) $58,214

(C) $37,694

Step-by-step explanation:

(A) The computation of the total net revenue is shown below:

= Sales revenue - Sales returns and allowances - Sales discounts + Rent revenue + Dividend revenue

= $408,000 - $12,490 - $7,950 + $7,170 + $71,680

= $466,410

(B) The computation of the net income is shown below:

As we know that net income = Total revenue - total expenses

where,

Total revenue = Sales revenue - Sales returns and allowances - Sales discounts + Rent revenue + Dividend revenue

= $408,000 - $12,490 - $7,950 + $7,170 + $71,680

= $466,410

And, the total expenses = Cost of goods sold + Interest expense + Administrative expenses + Selling expenses + income tax expense

= $184,188 + $13,680 + $84,550 + $99,450 + $26,328

= $408,196

Now put these values to the above formula

So, the value would equal to

= $466,410 - $408,196

= $58,214

(C) The computation of the income attributable to controlling stockholder is shown below:

= Net income - allocation to non controlling interest

= $58,214 - $20,520

= $37,694