Question
On January 1, 2013, Parent Company purchased 80% of the outstanding shares of Subsidiary Company at a cost of P800,000. On that date, Subsidiary Company
On January 1, 2013, Parent Company purchased 80% of the outstanding shares of Subsidiary Company at a cost of P800,000. On that date, Subsidiary Company had P500,000 of capital stock and P500,000 of retained earnings. (NCI measured at proportionate interest) For 2013, Parent company had income of P280,000 from its own operations (excluding its share of income from Subsidiary) and paid dividends of P150,000. For 2013, Subsidiary Company reported income of P65,000 and paid dividends of P30,000. All the assets and liabilities of Subsidiary Company have book value equal to their respective market values. On January 1, 2013, Subsidiary Company sold equipment to Parent Company for P100,000. The book value of the equipment on that date was P120,000. The loss of P20,000 is reflected in the income of Subsidiary Company indicated above. The equipment is expected to have a useful life of five years from the date of the sale. In the December 31,2013 consolidated statement of financial position, the NCI should be presented at:*
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