Question

on january 1, pumpkin corporation acquired 70 percent of spice company's common stock for #210,000 cash. what amount will be reported as noncontrolling interest in the consolidated balance sheet immediately

Answer 1

$90,000

Step-by-step explanation:

We are assuming that the $210,000 paid for 70% of Pumpkin Corporation represents a fair value for their stock. The non-controlling interest is 30% of the company's stocks and we can use the value paid to determine the value of the non-controlling interest.

Non-controlling interest = ($210,000 / 70) * 30 = $90,000