Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

In 2019, entity A sold goods to its subsidiaries (entities B and C) for P500,000 and P400,000, respectively. In 2019, entity A sold goods to

In 2019, entity A sold goods to its subsidiaries (entities B and C) for P500,000 and P400,000, respectively. In 2019, entity A sold goods to its associates (entities D and E) for P50,000 and P40,000 respectively. On 31 December 2019 entities B, C, D and E owed entity A P200,000, P100,000, P20,000 and P10,000, respectively. The terms and conditions of the sales to entities B, C, D and E are the same as for sales to independent third parties, ie list price on 30 days’ interest-free credit. In 2019, entity A purchased raw materials from its owner (Mr. A) for P125,000. Mr. A supplies raw materials to entity A at a discount of 20 per cent on the price at which he supplies other customers that purchase similar quantities of raw materials. In common with other customers, Mr. A supplies entity A with raw materials on 30 days’ interest-free credit. On 31 December 2019 entity A reported that it had reimbursed Mr. A’s expenses of P400,000 for leisure trips.


How much is the total amount of related party transactions to be disclosed for 2019 financial statements?

Step by Step Solution

3.40 Rating (150 Votes )

There are 3 Steps involved in it

Step: 1

Related Party under Companies Act 2013 A company is an artificial judicial person having a separate ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cornerstones of Financial Accounting

Authors: Jay Rich, Jeff Jones

4th edition

978-1337690881, 9781337669450, 1337690880, 1337690899, 1337669458, 978-1337690898

More Books

Students also viewed these Law questions

Question

Explain the terms and conditions of mudarabah contracts.

Answered: 1 week ago

Question

Explain the terms and conditions of Musharakah Contracts

Answered: 1 week ago

Question

How is the amount of a liability measured?

Answered: 1 week ago