A subsidiary that is 75% owned by its parent company pays a dividend of R100 00. On consolidation the amount to be eliminated: Select one: A. none of the above B. R100 000 C. R25 000 D. 75 000
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A subsidiary that is 75% owned by its parent company pays a dividend of R100 00. On
consolidation the amount to be eliminated:
Select one:
A. none of the above
B. R100 000
C. R25 000
D. 75 000
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- A subsidiary that is 75% owned by its parent company pays a dividend of R100 000. On consolidation the amount to be eliminatedFor the year ended December 31, the following results were given: Dividend Paid Net Income Parent Company P15,000 P30,200Subsidiary Company 4,000 9,400 Using the proportionate basis or partial goodwill method, compute the non-controlling interest on December 31.A. P 10,600 C. P 12,010B. P11,140 D. P 12,300 Note: Just use the information provided to solve the problem.Procta Ltd is determined to report earnings per share of R9.5. It therefore acquires JJ&J Company. You are given the following facts Proctas Ltd JJ&J Merged firm Earnings per share R6.50 R8 R9.50 Price per share R36 R21 ? Price-earnings ratio 18 7 ? Number of shares 50000 60000 ? Total earnings R325,000 R480,000 ? Total market value R5,850,000 R3,360,000 ? Once again there are no gains from merging. In exchange for JJ&J shares,Proctas Ltd issues just enough of its own shares to ensure its R2.67 earnings per share objective. a. Complete the above table for the merged firm. c. What is the cost of the cash offer if proctas ltd paid R2500000 for JJ&J?
- Choose the correct. The parent company acquires all of a subsidiary’s common stock but only 70 percent of its preferred shares. This preferred stock pays a 7 percent annual cumulative dividend. No dividends are in arrears at the current time. How is the noncontrolling interest’s share of the subsidiary’s income computed?a. As 30 percent of the subsidiary’s preferred dividend.b. No allocation is made because the dividends have been paid.c. As 30 percent of the subsidiary’s income after all dividends have been subtracted.d. Income is assigned to the preferred stock based on total par value and 30 percent of that amount is allocated to the noncontrolling interest.World Enterprises is determined to report earnings per share of $2.17. It therefore acquires the Wheelrim and Axle Company. You are given the following facts: WorldEnterprises Wheelrimand Axle Merged Firm Earnings per share $ 1.80 $ 2.40 $2.17 Price per share $ 36.00 $ 24.00 ? Price–earnings ratio 20 10 ? Number of shares 90,000 140,000 ? Total earnings $ 162,000 $ 336,000 ? Total market value $ 3,240,000 $ 3,360,000 ? There are no gains from merging. In exchange for Wheelrim and Axle shares, World Enterprises issues just enough of its own shares to ensure its $2.17 earnings per share objective. Required: Complete the below table for the merged firm. How many shares of World Enterprises are exchanged for each share of Wheelrim and Axle? What is the cost of the merger to World Enterprises? What is the change in the total market value of the World Enterprises shares that were…The parent company acquires all of a subsidiary’s common stock but only 70 percent of its preferred shares. This preferred stock pays a 7 percent annual cumulative dividend. No dividends are in arrears at the current time. How is the noncontrolling interest’s share of the subsidiary’s income computed?a. As 30 percent of the subsidiary’s preferred dividend.b. No allocation is made because the dividends have been paid.c. As 30 percent of the subsidiary’s income after all dividends have been subtracted.d. Income is assigned to the preferred stock based on total par value and 30 percent of that amount is allocated to the noncontrolling interest.
- For the year ended December 31, the following results were given: Dividend Paid Net Income Parent Company P15,000 P30,200Subsidiary Company 4,000 9,400 Using the proportionate basis or partial goodwill method, compute the non-controlling interest on December 31.A. P 0 C. P 610B. P 540 D. P 940 Note: Just use the information provided to arrive at the answer.P Corporation is parent having purchased 60% of S Company's ordinary shares at par value of P600,000. S Company is in financial difficulty. The parent granted an unsecured loan of P200,000 to the subsidiary. An accounting statement of affairs for S Company shows a dividend of 30%. What amount can P Corporation expect to receive on the loan?The parent company acquires all of a subsidiary’s common stock but only 70 percent of its preferred shares. This preferred stock pays a 7 percent annual cumulative dividend. No dividends are in arrears at the current time. How is the noncontrolling interest’s share of the subsidiary’s income computed? As 30 percent of the subsidiary’s preferred dividend. No allocation is made because the dividends have been paid. As 30 percent of the subsidiary’s income after all dividends have been subtracted. Income is assigned to the preferred stock based on total par value and 30 percent of that amount is allocated to the noncontrolling interest.
- The following information pertains to the following 2 Questions. Assume the following facts relating to an 80% owned subsidiary company: BOY Stockholders’ Equity $1,000,000 BOY unamortized AAP 125,000 Net income of subsidiary (not including AAP amortization) 210,000 AAP amortization expense 40,000 Dividends declared and paid to noncontrolling shareholders 10,000 22. What is the net income attributable to noncontrolling interests for the year? a. $128,000 b. $136,000 c. $160,000 d. $168,000 23. What is the amount reported as noncontrolling equity at the end of the year? a. $895,200 b. $996,000 c. $1,026,000 d. $1,028,000Show the complete solution. THank you On January 1, 20X1, P Company (PC) purchased 80% of the outstanding shares of S Company (SC) at the cost of P700,000. On that date, SC had P300,000 and P500,000 capital stock and retained earnings, respectively. The non-controlling interest (NCI) is measured on a fair-value For 20X1, PC had a comprehensive income (CI) of P300,000 and paid dividends of P100,000. On the other hand, SC reported a CI of P150,000 and paid dividends of P50,000. All of the assets and liabilities of S Company had book values that approximately equal to their respective market values. On December 31, 20X1, PC sold a piece of equipment with a book value of P30,000 to SC for P25,000. The gain on the sale is included in the CI of PC indicated above. The equipment has a 10-year useful life. It has been used for the past five (5) years before the date of acquisition. Required: Prepare the journal entries that both companies should make for the year 20X1. Allocate the…Parent and its 70% owned Subsidiary report the following at December 31 of the current year: Parent Net Income, P300,000; Parent Dividends, P20,000. Subsidiary Net Income, P250,000; Subsidiary Dividends, P20,000. On January 3, of the current year, Parent sold equipment to Subsidiary with a remaining 5-year life reporting a gain on sale of P20,000. The gain is included in the net income reported by the Parent. 1. Determine the equity holders of parent’s net income and the non-controlling interest net income. 2. Determine the equity holders of parent's net income.