Question

2.2. park company acquired an 80% interest in the common stock of southdale company for $1,540,000 on july 1, 2013. southdale company's stockholders' equity on that date consisted of: common stock $800,000 other contributed capital 400,000 retained earnings 330,000 compute the total non-controlling interest to be reported in the consolidated balance sheet. hint: a cad could be used to solve this problem. (5 points for correct answer; 5 points for formatting; 10 points total)

Answer 1

The total non-controlling interest in the consolidated balance sheet is calculated as follows:

Total assets of Southdale Company = common stock + other contributed capital + retained earnings
= $800,000 + $400,000 + $330,000
= $1,530,000

Park Company's 80% interest in Southdale Company's stock = 80% x $1,540,000 = $1,232,000

Non-controlling interest = Total assets - Park Company's interest
= $1,530,000 - $1,232,000
= $298,000

Therefore, the total non-controlling interest to be reported in the consolidated balance sheet is $298,000.