Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On January 2, 2019, P Company purchased 80% of the outstanding shares of S Company for P1,400,000. The parent opted to measure NCI proportionate to

On January 2, 2019, P Company purchased 80% of the outstanding shares of S Company for P1,400,000. The parent opted to measure NCI proportionate to their share on the identifiable net assets. At that date, the stockholders' equity of P Company and S Company is composed of the following:

Share Capital

P - 5,000,000

S - 1,150,000

Share Premium

P - 1,500,000

S - 350,000

Retained Earnings

P - 1,150,000

S - 370,000

The carrying values of the assets and liabilities of S Company are equal to their fair values except for the following:

Equipment with 5 years remaining life had a fair value which is lower than its carrying value by P60,000.

The fair value of S Company's Loans Payable is to be adjusted upward by P20,000.

The income reported and dividends paid by P Company and S Company for 2019 are as follows:

Net Income

P -370,000

S -250,000

Dividends

P - 90,000

S - 80,000

Determine the following:

a. Consolidated Net Income

b. Net Income Attributable to Parent

c. Net Income Attributable to NCI

d. NCI as of December 31, 2019

e. Consolidated Retained Earnings as of December 31, 2019

Step by Step Solution

There are 3 Steps involved in it

Step: 1

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

Accounting Terminology

Authors: Michael P Griffin

1st Edition

1423229371, 9781423229377

More Books

Students also viewed these Accounting questions

Question

What is Larmors formula? Explain with a suitable example.

Answered: 1 week ago

Question

3. What is my goal?

Answered: 1 week ago

Question

2. I try to be as logical as possible

Answered: 1 week ago