Problem:
Edwin Co. owned 70% of the voting common stock of Frank Co. During 2010, Frank made frequent sales of inventory to Edwin. There were unrealized gains of $40,000 in the beginning inventory and $25,000 of unrealized gains at the end of the year. Frank reported net income of $137,000 for 2010. Edwin decided to use the equity method to account for the investment.
Required:
Question: What is the non-controlling interest's share of Devin's net income for 2010?
A. $41,100.
B. $33,600.
C. $45,600
D. $21,600.
E. $36,600.
Note: Please show basic calculation