On January 1, 2018, Lowell Corp. acquired 80% of the voting common stock of Boston Inc. During the year, Lowell sold to Boston for $450,000 goods that cost $330,000. At year-end, Boston owned 15% of the goods transferred. Boston reported net income of $204,000, and Lowell's net income was $806,000. Lowell decided to use the equity method to account for this investment. Assuming there are no excess amortizations associated with the consolidation, and no other intra-entity asset transfers, what was the net income attributable to the noncontrolling interest

$40,800

Explanation:

The computation of  the net income is shown below:-

With regard to non-controlling interest, Lowell Corp. and the non-controlling interest divided Boston net profits proportionately to their ownership interests.

Non controlling interest share of consolidated net income = Boston net income × Remaining percentage

= $204,000 × (100% - 80%)

= $204,000 × 20%

= $40,800

Therefore for computing the Non controlling interest share of consolidated net income we simply multiply the Boston net income with remaining percentage.

E. $480

Explanation:

For computing the included amount, first we have to find out the increase in working capital which is shown below:

Increase in working capital = Increase sales × sales percentage

For Year 1

Increase in working capital = $146,000 × 0.08

                                             = $11,680

For Year 2

Increase in working capital = $152,000 × 0.08

                                             = $12,160

For Year 3

Increase in working capital = $158,000 × 0.08

                                             = $12,640

For Year 4

Increase in working capital = $164,000 × 0.08

                                             = $13,120

For Year 5

Increase in working capital = $155,000 × 0.08

                                             = $12,400

Now net working capital would be

Year 1                   $11,680

Year 2                  $12,160           $480

Year 3                  $12,640          $480

Year 4                  $13,120           $480

Year 5                  $12,400         -$720

We deducted it from the bottom

Like $12,400 - $13,120 = -$720

$13,120 - $12,640 = $480 and so on