Prepare consolidated income statements for solvent company

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Reference no: EM13950599

Gross pro?t: separate ?rms versus consolidated. Solvent is an 80%-owned subsidiary of the Painter Company. The two af?liates had the following separate income statements for 20X1 and 20X2:

	Solvent Company		Painter Company
	20X1	20X2	20X1	20X2
Sales revenue	$250,000	$300,000	$500,000	$540,000
Cost of goods sold	150,000	180,000	310,000	360,000
Gross pro?t	$100,000	$120,000	$190,000	$180,000
Expenses	45,000	56,000	120,000	125,000
Net income	$ 55,000	$ 64,000	$ 70,000	$ 55,000

Solvent sells at the same gross pro?t percentage to all customers. During 20X1, Solvent sold goods to Painter for the ?rst time in the amount of $100,000. $20,000 of these sales remained in Painter's ending inventory. During 20X2, sales to Painter by Solvent were $110,000, of which $30,000 sales were still in Painter's December 31, 20X2, inventory.

Prepare consolidated income statements including the distribution of income to the controlling and noncontrolling interests for 20X1 and 20X2.

Reference no: EM13950599

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