Corvallis Corporation owns 80% of the stock of Little Harrisburg, Inc. At December 31, 2008, Little Harrisburg had the following summarized balance sheet:
LITTLE HARRISBURG, INC.
Balance Sheet December 31, 2008
|
Current assets
|
$100,000
|
Current liabilities
|
$ 50,000
|
|
Property, plant, and
|
|
Long-term debt
|
150,000
|
|
equipment (net)
|
400,000
|
Capital stock
|
50,000
|
|
|
|
Retained earnings
|
250,000
|
|
|
$500,000
|
|
$500,000
|
The earnings of Little Harrisburg, Inc., for 2008 were $50,000 after tax.
Required:
a. What would be the amount of minority interest on the balance sheet of Corvallis Corporation? How should minority interest be classified for financial statement analysis purposes?
b. What would be the minority share of earnings on the income statement of Corvallis Corporation?