On January 1, 2020, Jam Company reported as investmonts the following unquoted equity shares: long term Dale Company, 5,000 ordinary shares (1% interest) Ever Company, 10,000 ordinary shares ( 2%% interest) Fox Company, 25,000 ordinary shares (10% interest) 1,250,000 1,600,000 2,000,000 1. On May 1, 2020, Dale Company issued a 10% share dividend. 2. On November 1, 2020, Dale Company paid a cash dividend of P20 per share. 3. On January 1, 2020, Jam Company paid P5,000,000 for 50,000 additional ordinary shares of Fox Company which represented a 20% investment in Fox Company. The fair value of all of Fox's identifiable assets net of liabilities was equal to their carrying amount of P20,000,000. Jam Company's initial 10% interest of 25,000 ordinary shares of Fox Company was acquired on January 1, 2019 for P2,000,000. The 10% interest was accounted for un der cost method. On January 1, 2020, this 10% existing interest had a fair value of P2,400,000. Fox Company reported net income of P6,000,000 for 2020. and paid dividend of P20 per share on December 31, 2020.
On January 1, 2020, Jam Company reported as investmonts the following unquoted equity shares: long term Dale Company, 5,000 ordinary shares (1% interest) Ever Company, 10,000 ordinary shares ( 2%% interest) Fox Company, 25,000 ordinary shares (10% interest) 1,250,000 1,600,000 2,000,000 1. On May 1, 2020, Dale Company issued a 10% share dividend. 2. On November 1, 2020, Dale Company paid a cash dividend of P20 per share. 3. On January 1, 2020, Jam Company paid P5,000,000 for 50,000 additional ordinary shares of Fox Company which represented a 20% investment in Fox Company. The fair value of all of Fox's identifiable assets net of liabilities was equal to their carrying amount of P20,000,000. Jam Company's initial 10% interest of 25,000 ordinary shares of Fox Company was acquired on January 1, 2019 for P2,000,000. The 10% interest was accounted for un der cost method. On January 1, 2020, this 10% existing interest had a fair value of P2,400,000. Fox Company reported net income of P6,000,000 for 2020. and paid dividend of P20 per share on December 31, 2020.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 5MC: Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par...
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Question
Prepare journal entries for 2020
Transcribed Image Text:On January 1, 2020, Jam Company reported as
investmonts the following unquoted equity shares:
long term
Dale Company, 5,000 ordinary shares ( 1% interest)
Ever Company, 10,000 ordinary shares ( 2% interest)
Fox Company, 25,000 ordinary shares (10% interest)
1,250,000
1,600,000
2,000,000
1. On May 1, 2020, Dale Company issued a 10% share
dividend.
2. On November 1, 2020, Dale Company paid a cash dividend
of P20 per share.
3. On January 1, 2020, Jam Company paid P5,000,000 for
50,000 additional ordinary shares of Fox Company which
represented a 20% investment in Fbx Company.
The fair value of all of Fox's identifiable assets net of
liabilities was equal to their carrying amount of
P20,000,000.
Jam Company's initial 10% interest of 25,000 ordinary
shares of Fox Company was acquired on January 1, 2019
for P2,000,000.
The 10% interest was accounted for un ler cost method.
On January 1, 2020, this 10% existing interest had a fair
value of P2,400,000.
Fox Company reported net income of P6,000,000 for 2020.
and paid dividend of P20 per share on December 31, 2020.
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