Reference no: EM133112102

Question - Mighty Company purchased a 60 percent interest in Lowly Company on January 1, 2020, for $570,900 in cash. Lowly's book value at that date was reported as $767,500, and the fair value of the non-controlling interest was assessed at $380,600. Any excess acquisition-date fair value over Lowly's book value is assigned to trademarks to be amortized over 20 years. Subsequently, on January 1, 2021, Lowly acquired a 20 percent interest in Mighty. The price of $334,000 was equivalent to 20 percent of Mighty's book and fair value.

Neither company has paid dividends since these acquisitions occurred. On January 1, 2021, Lowly's book value was $1,035,500, a figure that rises to $1,087,000 (common stock of $300,000 and retained earnings of $787,000) by year-end. Mighty's book value was $1.67 million at the beginning of 2021 and $1.77 million (common stock of $1 million and retained earnings of $770,000) at December 31, 2021. No intra-entity transactions have occurred, and no additional stock has been sold. Each company applies the initial value method in accounting for the individual investments.

Required - Prepare worksheet entries which are required to consolidate these two companies for 2021.

What is the net income attributable to the noncontrolling interest for this?