Parent company (P Co) paid $180,000 to acquire 60% interest in Subsidiary (S Co) when the share capital of S was $110,000 and its retained earnings was $100,000. At the date of acquisition (January 1 2015), the excess of fair value over book values of S Co were $50,000, which were caused by an undervalued fixed asset. The undervalued fixed asset had a useful life 10 years from date of acquisition. The fair value of non-controlling interests as at the date of acquisition was $114,000. On December 31 2019, retained earnings of S was $210,000 and share capital remain unchanged since acquisition date. Tax rate is 20%. The balance of non-controlling interests on December 31 2019 is:

Select one:

a. $144,000

b. $150,000

c. $128,000

d. $136,000

Parent company (P Co) paid $180,000 to acquire 60% interest in Subsidiary (S Co) when the share capital of S was $110,000 and its retained earnings was $100,000. At the date of acquisition (January 1 2015), the excess of fair value over book values of S Co were $50,000, which were caused by an undervalued fixed asset. The fair value of non-controlling interests as at the date of acquisition was $114,000. On December 31 2019, retained earnings of S was $210,000 and share capital remain unchanged since acquisition date. Tax rate is 20%. On acquisition date, the amount of goodwill based on entity theory is:

Select one:

a. $30,000

b. $14,000

c. $34,000

d. $44,000

P Co completed the purchase of 55% of X Co from A Co, the existing owner of X Co. The following expenditures by P Co relation to the acquisition:

Payment to consultants to conduct due diligence checks	$250,000
Shares issued by P Co to A Co	4,800,000
Fair value per share of P Co at date of share issue	$1.80
Salary of Business Development Manager of P Co for June 20x5	$24,000
Travelling expenses incurred by the Manager related to the acquisition of X Co	$13,000
Undiscounted cash payment payable to A Co at the end of 3 years	$800,000
Interest payable to A Co for deferred payment	5%
Assumption of the short-term liabilities of the A Co	$180,000
Legal fees to execute sales agreement with A Co	$28,000
Stamp duties and other incidentals of share issue to A Co	$9,000

The consideration transferred for the acquisition of X Co is:

Select one:

a. $9,620,000

b. 8,640,000

c. $9,511,070

d. $9,331,070

Parent Co. owns 80% of Subsidiary Co.s common stock. During 2019, Parent sold inventory to Subsidiary for $250,000. The original cost of inventory was $200,000. Subsidiary sold all the inventory purchased from Parent to third parties in 2019. The following data pertain to sales by each company for the year:

	Parent	Subsidiary
Sales	$1,000,000	$700,000
Cost of sales	400,000	350,000

How much should be reported as cost of sales in the consolidated financial statement for the year?

Select one:

a. $550,000

b. $680,000

c. $500,000

d. $750,000