1. It is assumed that the land was sold by Bright Company to Avrill Company and PT Saman still owns the land as of December 31, 2016 a. Calculate consolidated net income for 2015 and 2016 b. calculate minority interest income in 2015 and 2016 2. It is assumed that the land was sold by Avril Company to Bright Company and Bright Company still owns the land as of December 31, 2016. a. Calculate consolidated net income for 2015 and 2016 b. Calculate minority interest income in 2015 and 2016
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- On January 1, 2009, BANG BANG Co. purchased 80% of BANGITY BANG Co.'s outstanding stock for $620,000. At that date, all of BANGITY BANG's assets and liabilities had market values approximately equal to their book values and no goodwill was included in the purchase price. The following information was available for 2009: Income from own operations of Parent-$150,000 Operating Loss of Subsidiary-$20,000 Dividends paid in 2013 by parent-$75,000 Dividends paid by Subsidiary to Parent-$12,000. On July 1 ,2009, there was a downstream sale of equipment at a gain of $25,000. The equipment is expected to have a remaining useful life of 10 years from the date of sale. Also, on January 1, 2009, there was an upstream sale of furniture at a loss of $7,500. The furniture is expected to have a useful life of five years from the date of sale. Non-controlling interest is measured at fair value. Determine the consolidated net income attributable to the parent shareholders' equity.On January 1, 2013, BAZINGA Co. purchased 80% of MEEMAW Co.'s outstanding stock for $62,000. At that date, all of MEEMAW's assets and liabilities had market values approximately equal to their book values and no goodwill was included in the purchase price. The following information was available for 2013: Income from own operations of Parent-$15,000 Operating Loss of Subsidiary-$2,000 Dividends paid in 2013 by parent-$7,500 Dividends paid by Subsidiary to Parent-$1,200. On July 1 ,2013, there was a downstream sale of equipment at a gain of $2,500. The equipment is expected to have a remaining useful life of 10 years from the date of sale. Also, on January 1, 2013, there was an upstream sale of furniture at a loss of $750. The furniture is expected to have a useful life of five years from the date of sale. Non-controlling interest is measured at fair value. Determine the consolidated net income attributable to the parent shareholders' equity.Up and its 80 percent–owned subsidiary (Down) reported the following figures for the year ending December 31, 2018. Down paid dividends of $30,000 during this period. UP DOWN Sales $(600000) $(300000) Cost of goods sold 300000 140000 Operating expenses 174000 60000 Dividend Income (24000) -0- Net income $(150000) $(100000) In 2017, intra-entity gross profits of $30,000 on upstream transfers of $90,000 were deferred into 2018. In 2018, intra-entity gross profits of $40,000 on upstream transfers of $110,000 were deferred into 2019.a. What amounts appear for each line in a consolidated income statement? Explain your computations.b. What income tax expense should appear on the consolidated income statement if each company files a separate return? Assume that the tax rate is 30 percent.
- Addo Plc owns many subsidiaries and 25% of Vivian Plc. In the year ended 31 December 2018, Addo Plc sold goods to Vivian for GH¢200,000, earning a gross profit margin of 20%. Vivian Plc held GH¢60,000 of them in its inventories at the year end. By what amount should Addo Plc’s cost of sales be increased when preparing its consolidated statement of profit or loss?On January 1, 2015, P Corporation purchased 80% of S Company’s outstanding shares for ₱620,000. At that date, all of S Company’s assets and liabilities had market values approximately equal to their book values and no goodwill was included in the purchase price. The following information was available for 2015: Income from own operations of P Corporation, ₱150,000; Operating loss of S Company, ₱20,000. Dividends paid in 2015 by P Corporation, ₱75,000; by S Company to P Corporation, ₱12,000. On July 1, 2015, there was a downstream sale of equipment at a gain of ₱25,000. The equipment is expected to have a remaining useful life of 10 years from the date of sale. Also, on January 1, 2015, there was an upstream sale of furniture at a loss of ₱7,500. The furniture is expected to have a useful life of five years from the date of sale. Non-controlling interest is measured at fair market value. How much is the consolidated net income attributable to parent shareholders’ equity? A. ₱97,250B.…On January 2, 2016, PARENT Company acquired 90% of the outstanding shares of SUBSIDIARY Company at book value. During 2016 and 2017, intercompany sales amounted to $2,000,000 and $4,000,000 respectively. SUBSIDIARY Company consistently recognized a 25% mark up based on sales while PARENT Company had a 25% gross profit on cost. The inventories of the buying affiliate, which all came from intercompany trasactions show: Dec. 31, 2016 Dec. 31, 2017 PARENT Company 240,000 160,000 SUBSIDIARY Company 100,000 40,000 On October 1, 2016, PARENT Company purchased a piece of land costing $1,000,000 from SUBSIDIARY Company for $1,500,000. On December 31, 2017, PARENT Company sold this land to an unrelated paty for $1,500,000. On the other hand, on July 1, 2017, PARENT Company sold a used machine with a carrying value of $60,000 and remaining life of 3 years to SUBSIDIARY Company for $42,000. Separate Statement of Comprehensive Income for the two companies for 2017 follow: PARENT…
- following are several figures reported for Allister and Barone as of December 31, 2018: Allister Barone Inventory $ 400,000 $ 200,000 Sales 800,000 600,000 Investment income not given Cost of goods sold 400,000 300,000 Operating expenses 180,000 250,000 Allister acquired 70 percent of Barone in January 2017. In allocating the newly acquired subsidiary's fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $65,000 that was unrecorded on its accounting records and had a 5-year remaining life. Any remaining excess fair value over Barone's book value was attributed to goodwill. During 2018, Barone sells inventory costing $120,000 to Allister for $160,000. Of this amount, 20 percent remains unsold in Allister's warehouse at year-end. Determine balances for the following items that would appear on Allister's consolidated financial statements for 2018: Inventory____$_____________________…Following are several figures reported for Allister and Barone as of December 31, 2018: Allister BaroneInventory . . . .. . $ 500,000 $300,000Sales . . . . . . . . . 1,000,000 800,000Investment income not given Cost of goods sold 500,000 400,000Operating expenses 230,000 300,00 Allister acquired 90 percent of Barone in January 2017. In allocating the newly acquired subsidiary’s fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $78,000 that was unrecorded on its accounting records and had a 4 year remaining life. Any remaining excess fair value over Barone’s book value was attributed to goodwill. During 2018, Barone sells inventory costing $130,000 to Allister for $180,000. Of this amount, 10 percent remains unsold in Allister’s warehouse at year-end.Determine balances for the following items that would appear on Allister’s consolidated financial statements for…On January 1, 2016, Uncle Company purchased 80 percent of Nephew Company’s capital stock for $500,000 in cash and other assets. Nephew had a book value of $600,000, and the 20 percent noncontrolling interest fair value was $125,000 on that date. On January 1, 2015, Nephew had acquired 30 percent of Uncle for $280,000. Uncle’s appropriately adjusted book value as of that date was $900,000.Separate operating income figures (not including investment income) for these two companies follow. In addition, Uncle declares and pays $20,000 in dividends to shareholders each year and Nephew distributes $5,000 annually. Any excess fair-value allocations are amortized over a 10-year period. Year Uncle Company Nephew Company 2016 $90000 $30000 2017 120000 40000 2018 140000 50000 a. Assume that Uncle applies the equity method to account for this investment in Nephew. What is the subsidiary’s income recognized by Uncle in 2018?b. What is the net income attributable to the noncontrolling…
- On January 1, 2016, Uncle Company purchased 80 percent of Nephew Company’s capital stock for $500,000 in cash and other assets. Nephew had a book value of $600,000, and the 20 percent noncontrolling interest fair value was $125,000 on that date. On January 1, 2015, Nephew had acquired 30 percent of Uncle for $280,000. Uncle’s appropriately adjusted book value as of that date was $900,000.Separate operating income figures (not including investment income) for these two companies follow. In addition, Uncle declares and pays $20,000 in dividends to shareholders each year and Nephew distributes $5,000 annually. Any excess fair-value allocations are amortized over a 10-year period.a. Assume that Uncle applies the equity method to account for this investment in Nephew. What is the subsidiary’s income recognized by Uncle in 2018?b. What is the net income attributable to the noncontrolling interest for 2018?On January 1, 2016, Uncle Company purchased 80 percent of Nephew Company's capital stock for $512,000 in cash and other assets. Nephew had a book value of $626,000 and the 20 percent noncontrolling interest fair value was $128,000 on that date. On January 1, 2015, Nephew had acquired 30 percent of Uncle for $283,000. Uncle's appropriately adjusted book value as of that date was $910,000. Separate operating income figures (not including investment income) for these two companies follow. In addition, Uncle declares and pays $30,000 in dividends to shareholders each year and Nephew distributes $4,000 annually. Any excess fair-value allocations are amortized over a 10-year period. Year UncleCompany NephewCompany 2016 $ 138,000 $ 34,000 2017 203,000 51,800 2018 236,000 52,600 Assume that Uncle applies the equity method to account for this investment in Nephew. What is the subsidiary's income recognized by Uncle in 2018? What is the net income…Following are several figures reported for Allister and Barone as of December 31, 2018: Allister Barone Inventory $ 410,000 $ 210,000 Sales 820,000 620,000 Investment income not given Cost of goods sold 410,000 310,000 Operating expenses 185,000 255,000 Allister acquired 80 percent of Barone in January 2017. In allocating the newly acquired subsidiary's fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $60,000 that was unrecorded on its accounting records and had a 4-year remaining life. Any remaining excess fair value over Barone's book value was attributed to goodwill. During 2018, Barone sells inventory costing $121,000 to Allister for $162,000. Of this amount, 10 percent remains unsold in Allister's warehouse at year-end. Determine balances for the following items that would appear on Allister's consolidated financial statements for 2018: