Computing the noncontrolling interests equity balance Assume the following facts relating to an 90% owned subsidiary company: BOY stockholders’ equity $900,000 BOY AAP assets 117,000 Net income of subsidiary (not including [A] asset depreciation and amortization) 216,000 AAP assets depreciation and amortization expense 36,000 Dividends declared and paid by subsidiary 18,000 b. Compute the amount reported as noncontrolling equity at the end of the year. $Answer

Computing the noncontrolling interests equity balance Assume the following facts relating to an 90% owned subsidiary company: BOY stockholders’ equity $900,000 BOY AAP assets 117,000 Net income of subsidiary (not including [A] asset depreciation and amortization) 216,000 AAP assets depreciation and amortization expense 36,000 Dividends declared and paid by subsidiary 18,000 b. Compute the amount reported as noncontrolling equity at the end of the year. $Answer

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 15MCQ

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Computing the noncontrolling interests equity balance Assume the following facts relating to an 90% owned subsidiary company: BOY stockholders’ equity $1,300,000 BOY AAP assets 169,000 Net income of subsidiary (not including [A] asset depreciation and amortization) 312,000 AAP assets depreciation and amortization expense 52,000 Dividends declared and paid by subsidiary 26,000 a. Compute the net income attributable to noncontrolling interests for the year. b. Compute the amount reported as noncontrolling equity at the end of the year.
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. $1,028,000
From the given data, determine the NON-CONTROLLING INTEREST on December 31, 20x8. On January 1, 20x8,Parent Company purchased 80% of the outstanding shares of Subsidiary Company for P800,000. On the date of acquisition, Subsidiary Company reported Ordinary Shares of P800,000 and Retained Earnings of P200,000. Subsidiary’s Inventory was understated by P20,000; Equipment with a 5-year life was understated by P20,000, Building with an 8-year life was understated by P80,000 and land was understated by P40,000. The non-controlling interest is to be stated at fair value and the fair value of the non-controlling interest on January 1, 20x8 is P210,000. During the year, Parent sold goods to Subsidiary for P150,000 at a 25% mark-up and in turn purchased P200,000 of Subsidiary’s goods which Subsidiary sold at a 20% mark-up. From the goods purchased, P50,000 remain in Parent’s books at the end of the year, while P20,000 remain in Subsidiary’s books at the end of the year. 30% of the undervalued…
This is a sample CPA FAR question: Company ABC recently acquired a subsidiary and needs to prepare consolidated financial statements. The subsidiary has assets worth $2 million, liabilities of $800,000, and common stock of $600,000. The non-controlling interest in the subsidiary is 20%. What is the consolidated value of the subsidiary's liabilities that should be reported? A) $800,000 B) $640,000 C) $520,000 D) $480,000 Please don't provide answer in image format thank you
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.
Assume a parent company owns a 100% controlling interest in its long-held subsidiary. The following excerpts are from the parent’s and subsidiary’s pre-consolidation income statements for the year ending December 31, 2019: Parent Subsidiary Revenues $3,000,000 $2,000,000 Cost of goods sold (2,250,000) (1,300,000) Gross profit $750,000 $700,000 On January 1, 2019, the subsidiary held no inventories purchased from the parent. During the year ending December 31, 2019, the parent company sold $400,000 of inventory to its subsidiary. All of the parent’s sales to affiliates and non-affiliates have the same gross margin. At December 31, 2019, the subsidiary still held in its inventory $120,000 of merchandise purchased from the parent. The remaining inventory was sold to unaffiliated third-party customers during the year ended December 31, 2020. Intercompany sales, profits in ending inventoryWhat amount of revenues will be reported in the consolidated…
Assume a parent company owns a 100% controlling interest in its long-held subsidiary. The following excerpts are from the parent’s and subsidiary’s pre-consolidation income statements for the year ending December 31, 2019: Parent Subsidiary Revenues $3,000,000 $2,000,000 Cost of goods sold (2,250,000) (1,300,000) Gross profit $750,000 $700,000 On January 1, 2019, the subsidiary held no inventories purchased from the parent. During the year ending December 31, 2019, the parent company sold $400,000 of inventory to its subsidiary. All of the parent’s sales to affiliates and non-affiliates have the same gross margin. At December 31, 2019, the subsidiary still held in its inventory $120,000 of merchandise purchased from the parent. The remaining inventory was sold to unaffiliated third-party customers during the year ended December 31, 2020. Intercompany sales, profits in ending inventoryWhat amount of gross profit will be reported in the consolidated…
The P Ltd acquires all issued capital of the S Ltd for a consideration of $1,000,000 cash and 800,000 shares each valued at $1.50. The summary statement of the financial position of the subsidiary company immediatelyfollowing the acquisition is: Fair value of assets acquired $2,640,000Fair value of liabilities acquired $720,000 , Total shareholders’ equity of the subsidiary company $800,000 ,Retained earnings of the subsidiary company $1,120,000 Please answer the following:(a) Pass the necessary journal entry to record the acquisition (b) Determine the amount of goodwill (or bargain purchase) arising out of the acquisition(c) Pass the necessary consolidation entry to eliminate the subsidiary by the parent company and Determine the amount of goodwill (or bargain purchase) arising out of the acquisition if the purchase consideration paid was $1,000,000 cash and 400,000 shares each valued at $1.50
1. Parent and its 80% owned Subsidiary report the following at December 31 of the current year: Parent Net Income, P100,000; Parent Dividends, P20,000, Parent Land, P500,000. Subsidiary Net Income, P80,000; Subsidiary Dividends, P10,000; Subsidiary Land, P300,000. On June 1, of the current year, Subsidiary sold land to Parent reporting a gain on sale of P10,000. The gain is included in the net income reported by the Subsidiary. Determine the valuation of Land in the consolidated balance sheet. 2. Parent and its 80% owned Subsidiary report the following at December 31 of the current year: Parent Net Income, P100,000; Parent Dividends, P20,000, Parent Land, P500,000. Subsidiary Net Income, P80,000; Subsidiary Dividends, P10,000; Subsidiary Land, P300,000. On June 1, of the current year, Subsidiary sold land to Parent reporting a gain on sale of P10,000. The gain is included in the net income reported by the Subsidiary. Determine the equity holders of parent’s net income. 3. Parent and…
On January 1, Parent Company acquired 90% of Subsidiary Company in exchange for 5,400 shares of P10 parcommon stock having a market value of P120,600. Parent and Subsidiary condensed balance sheet on January 1,were as follows: Using the proportionate basis or partial goodwill method, compute the following:1. The amount of goodwill on January 1:A. P 2,600 C. P 14,400B. P 3,800 D. P 25,2002. The equity holders of parent (or controlling interest) retained earnings on January 1:A. P 48,000 C. P 84,900B. P52,100 D. P 89,0003. The consolidated retained earnings on January 1:A. P 48,000 C. P 84,900B. P52,100 D. P 89,000
Parent and its 80% owned Subsidiary report the following at December 31 of the current year: Parent Net Income, P100,000; Parent Dividends, P20,000, Parent Land, P500,000. Subsidiary Net Income, P80,000; Subsidiary Dividends, P10,000; Subsidiary Land, P300,000. On June 1, of the current year, Subsidiary sold land to Parent reporting a gain on sale of P10,000. The gain is included in the net income reported by the Subsidiary. 1. Determine the equity holders of parent’s net income and the non-controlling interest net income. 2. Determine the non-controlling interest net income.
The P Ltd acquires all issued capital of the S Ltd for a consideration of $1,000,000 cash and 800,000 shares each valued at $1.50. The summary statement of the financial position of the subsidiary company immediately following the acquisition is:Fair value of assets acquired $2,640,000Fair value of liabilities acquired $720,000Total shareholders’ equity of the subsidiary company $800,000Retained earnings of the subsidiary company $1,120,000Required: (b) Determine the amount of goodwill (or bargain purchase) arising out of the acquisition

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bartleby, a Learneo, Inc. business

BOY stockholders’ equity	$900,000
BOY AAP assets	117,000
Net income of subsidiary (not including [A] asset depreciation and amortization)	216,000
AAP assets depreciation and amortization expense	36,000
Dividends declared and paid by subsidiary	18,000