Question: Atlanta Corporation owns 80 percent of Montgomery Company's stock. On December 28, 2015, Atlanta sells inventory with a cost of $59,000 to Montgomery for $73,000. Assume that none of this inventory is sold to an unrelated party by the end of 2015 and 70 percent is sold to unrelated parties in 2016.
Required: a. Prepare the intercompany transaction worksheet elimination for the preparation of the 2016 consolidated financial statements.
b. What is the income to noncontrolling interest in 2016 if Montgomery has reported net income of $242,000?