On January 1, 20X8, Package Company acquired 80 percent of Stamp Company's common stock for
$280,000 cash. At that date, Stamp reported common stock outstanding of $200,000 and retained earnings of
$100,000, and the fair value of the noncontrolling interest was $70,000. The book values and fair values of
Stamp's assets and liabilities were equal, except for other intangible assets which had a fair value $50,000
greater than book value and an 8-year remaining life. Stamp reported the following data for 20X8 and 20X9:
Stamp Corporation
Comprehensive Dividends
Year Net Income
Income
Paid
20X8 $ 25,000 $ 30,000 $ 5,000
20X9 35,000 45,000 10,000
Package reported net income of $100,000 and paid dividends of $30,000 for both the years.
