consolidated
On January 1, 2016, Pia company purchased 80% of the outstanding shares of She company by paying 700,000. On the date, She company had 300,000 capital stock and 500,000 of retained earnings. An undervalued asset attributable to building amounting to 75,000 with a remaining life of 25 years. All other asset and liabilities of She company had book value approximated there fair market value. On January 1, 2017 Pia company common stock and retained earnings amounted to 1,000,000 and 800,000, respectively while S company retained earnings is 600,000. The 2017 net income and dividends using cost (or initial value) model was as follows: Net income dividends Pia company 340,000 100,000 She company 150,000 50,000 On april 1, 2017, she company sold equipment with a book value of 30,000 to Pia company for 60,000. The gain on the sale is included in the net income of She company indicated above. The equipment is expected to have a remaining useful life of 5 years from the date of sale. On September 30, 2017 Pia company sold machinery with a book value of 40,000 to She company for 75,000. The gain on the sale is also included in the net income of Pia company indicated above. The machinery is expected to last for 10 years from the date of sale. 1. The investment in subsidiary account on December 31, 2017 a. 748,500 C. 721,600 b. 725,000 d. 700,000 2. The dividend income/ investment income for 2017 a. 88,500 C. 61,600 b. 65,000 d. 40,000 3. The non-controlling interest in net income a. 30,000 b. 25,500 c. 24,900 d. 24,300 4. The profit attributable to equity holders of parent (parent's interest/controlling interest in profit) for 2017 a. 356,500 C. 363,075 b. 362,200 d. 386,500 5. The consolidated group net income a. 356,500 C. 363,075 b. 362,200 d. 387,375 6. The parent's portion of consolidated retained earnings in December 31, 2017 a. 1,040,000 c. 1,123,075 b. 1,063,075 d. 1,140,675 7. The non controlling interest on December 31, 2017 a. 208,700 c. 174,900 b. 189,300 d. 173,100 8. The non controlling interest in net asset on December 31, 2018, assuming that the net income and dividends of subsidiary amounted to 200,000 and 70,000 respectively a. 208,000 c. 235,300 b. 209,200 d. 222,400 9. Compute Stockholder's equity of subsidiary on December 31, 2017 a. 2017; 1,000,000 and 2018; 1,000,000 c. 2017' 1,069,000 and 2018; 1,069,000 b. 2017; 1,000,000 and 2018; 1,130,000 d. 2017; 1,043,500 and 2018; 1,176,500 10. The consolidated stockholder's equity on December 31, 2017 a. 2,040,000 b. 2,349,375 c. 2,358,375 d. 2,375,975
