Question

paint corporation owns 82% of achille corporation and achille corporation owns 80% of badrack corporation. for the current year, the separate net incomes (excluding investment income) of paint, achille, and badrack are $120,000, $100,000, and $50,000, respectively. the cost of each investment was equal to the book value of the investment, which was also equal to the fair value.noncontrolling interest share for achille is

Answer 1

The noncontrolling interest share for Achille Corporation is 18% of its $100,000 net income, equating to $18,000, since Paint Corporation owns 82% of Achille.

Step-by-step explanation:

The calculation of noncontrolling interest share is an important concept in the consolidation of financial statements for a business entity that has less than 100% ownership in another entity. Since Paint Corporation owns 82% of Achille Corporation, the noncontrolling or minority interest share in Achille Corporation is the remaining 18%. To calculate the noncontrolling interest share of Achille's net income, you multiply the percentage of noncontrolling interest by Achille's net income. Therefore, the noncontrolling interest share for Achille is 18% of the $100,000 net income, which amounts to $18,000.