Determine earnings from nonconsolidated subsidiary

Reference no: EM131002025

The income statement of Tawls Company for the year ended December 31, 2008, shows the following:

Revenue from sales		$ 980,000
Cost of products sold		510,000
Gross profit Operating expenses: Selling expenses	$110,000	470,000
General expenses	140,000	250,000
Operating income		220,000
Equity on earnings of nonconsolidated subsidiary		60,000
Operating income before income taxes		280,000
Taxes related to operations		100,000
Net income from operations Extraordinary loss from flood (less applicable taxes of $50,000)		180,000 (120,000)
Minority share of earnings		(40,000)
Net income		$20,000

Required:

a. Compute the net earnings remaining after removing nonrecurring items.

b. Determine the earnings from the nonconsolidated subsidiary.

c. For the subsidiary that was not consolidated, what amount of income would have been included if this subsidiary had been consolidated?

d. What earnings relate to minority shareholders of a subsidiary that was consolidated?

e. Determine the total tax amount.

Reference no: EM131002025

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