Prepare a proper presentation of consolidated net income

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On January 1, 2018, Jannison Inc. acquired 85% of Tehran Co. by paying $450,500 cash. There is no active trading market for Tehran stock. Tehran Co. reported a Common Stock account balance of $140,000 and Retained Earnings of $280,000 at the date.

The fair value of Tehran Co. was appraised at $530,000. The total amount paid above the book value was related to two items. A trademark for $80,000 was not recorded on Tehran's books. It is expected to be good for 8 years. The remaining amount was recorded as a customer list that is good for 10 years.

The subsidiary earned $98,000 in 2918 and $126,000 in 2019. Without regard for this investment, Jannison had income of $308,000 in 2018 and $364,000 in 2019.

Prepare a proper presentation of consolidated net income for 2018.

Reference no: EM132410242

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