On January 1, 2022, Entity A, a small-medium enterprise, invested P400,000 for a 30% interest in a joint venture. Assume the INDEPENDENT CASES: For the year ended December 31, 2022, the joint venture reported a net income of P300,000 and declared dividends of P90,000. The fair value of the investment was P550,000, and the cost to sell was P50,000. There was a public price quotation for the joint venture. Entity A opted to use the cost model, what is the amount to be reported in profit or loss for the year ended December 31, 2022? Entity A opted to use the cost model, what is the balance of the Investment in Joint Venture account to be reported at December 31, 2022?
On January 1, 2022, Entity A, a small-medium enterprise, invested P400,000 for a 30% interest in a joint venture. Assume the INDEPENDENT CASES: For the year ended December 31, 2022, the joint venture reported a net income of P300,000 and declared dividends of P90,000. The fair value of the investment was P550,000, and the cost to sell was P50,000. There was a public price quotation for the joint venture. Entity A opted to use the cost model, what is the amount to be reported in profit or loss for the year ended December 31, 2022? Entity A opted to use the cost model, what is the balance of the Investment in Joint Venture account to be reported at December 31, 2022?
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
Chapter15: Contributed Capital
Section: Chapter Questions
Problem 1MC
Related questions
Question
On January 1, 2022, Entity A, a small-medium enterprise, invested P400,000 for a 30% interest in a joint venture.
Assume the INDEPENDENT CASES:
For the year ended December 31, 2022, the joint venture reported a net income of P300,000 and declared dividends of P90,000. The fair value of the investment was P550,000, and the cost to sell was P50,000. There was a public price quotation for the joint venture.
- Entity A opted to use the cost model, what is the amount to be reported in profit or loss for the year ended December 31, 2022?
- Entity A opted to use the cost model, what is the balance of the Investment in Joint Venture account to be reported at December 31, 2022?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 2 images
Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT