Cox Ltd. acquired 70% of the common shares of March Co. at the beginning of 20X7. At the acquisition date, March's shareholders' equity consisted of the following:
Common shares $720,000
Retained earnings 360,000
The only acquisition differential pertained to goodwill.
Cox's "Investment in March" general ledger account is as follows:
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1/2/X7 Cost $ 781,200
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12/31/X7 Dividends $33,600
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12/31/X7 Investment Income 62,160
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12/31/X8 Dividends 42,000
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12/31/X8 Investment Income 76,440
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12/31/X9 Dividends 50,400
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12/31/X9 Investment income 94,080
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Balance $ 887,880
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March usually declares half of its profits as dividends.
Cox uses the entity theory method to consolidate its subsidiary.
Required:
a) Calculate the total amount of dividends declared by March for 20X7.
b) Calculate March's profit for 20X8.
c) Calculate the non-controlling interest amounts for Cox's 20X9
i. consolidated income statement, and
ii. consolidated balance sheet.
d) Calculate the amount of goodwill that should appear on Cox's 20X9 consolidated balance sheet.