On January 2, 2021, Harry Co. acquired 60% interest in Louis Corp. for P360,000. Information on Louis Corp's financial position on acquisition date follows:The identifiable assets and liabilities approximated their fair values except for inventories with carrying amount of P144,000 and fair value of P96,000 and building with carrying value amount of P240,000 and fair value of P250,000. The building has a remaining useful life of 8 years.Louis's retained earnings was P48,000Non-controlling interest is measured at a fair value of P240,000A summary of the individual financial information of the entities on December 31, 2021 is shown below: Louis Co.Harry Co.Total Assets550,0001,550,000Total Liabilities132,00034,000Share Capital300,0001,200,000Retained Earnings118,000316,000Sales350,000700,000Cost of Sales80,000200,000Other Operating Expenses200,000400,000How much is the consolidated profit?

The question is related to Consolidated Financial Statement. The parent company (Harry co.) has…

Answered: How much is the consolidated profit?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 30E

See similar textbooks

Related questions

Question

On January 2, 2021, Harry Co. acquired 60% interest in Louis Corp. for P360,000. Information on Louis Corp's financial position on acquisition date follows:

The identifiable assets and liabilities approximated their fair values except for inventories with carrying amount of P144,000 and fair value of P96,000 and building with carrying value amount of P240,000 and fair value of P250,000. The building has a remaining useful life of 8 years.
Louis's retained earnings was P48,000
Non-controlling interest is measured at a fair value of P240,000

A summary of the individual financial information of the entities on December 31, 2021 is shown below:

	Louis Co.	Harry Co.
Total Assets	550,000	1,550,000
Total Liabilities	132,000	34,000
Share Capital	300,000	1,200,000
Retained Earnings	118,000	316,000
Sales	350,000	700,000
Cost of Sales	80,000	200,000
Other Operating Expenses	200,000	400,000

How much is the consolidated profit?

Expert Solution

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions