On January 2, 2020, Popsters Corporation purchased 80% of SG Corporation's ordinary shares for P648,000. P30,000 of the excess is attributable to goodwill and the balance to an equipment with an economic life of ten years. Non-controlling interest is measured at its fair value on date of acquisition. On the date of acquisition, stockholders' equity of the two companies were as follows: SG Popsters 1,050,000 1,560,000 On December 31, 2020, Subsidiary reported net income of P105,000 and paid dividends of P36,000 to Parent. Parent reported earnings from its separate operations of P285,000 and paid dividends of P138,000. Goodwill had Share Capital Retained Earnings 240,000 420,000 been impaired and should be reported at P6,000 on December 31, 2020.
On January 2, 2020, Popsters Corporation purchased 80% of SG Corporation's ordinary shares for P648,000. P30,000 of the excess is attributable to goodwill and the balance to an equipment with an economic life of ten years. Non-controlling interest is measured at its fair value on date of acquisition. On the date of acquisition, stockholders' equity of the two companies were as follows: SG Popsters 1,050,000 1,560,000 On December 31, 2020, Subsidiary reported net income of P105,000 and paid dividends of P36,000 to Parent. Parent reported earnings from its separate operations of P285,000 and paid dividends of P138,000. Goodwill had Share Capital Retained Earnings 240,000 420,000 been impaired and should be reported at P6,000 on December 31, 2020.
Chapter20: Corporations: Distributions In Complete Liquidation And An Overview Of Reorganizations
Section: Chapter Questions
Problem 34P
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how much is the net income attributable to the parent?
Transcribed Image Text:On January 2, 2020, Popsters Corporation purchased 80% of SG Corporation's ordinary shares for P648,000.
P30,000 of the excess is attributable to goodwill and the balance to an equipment with an economic life of ten
years. Non-controlling interest is measured at its fair value on date of acquisition. On the date of acquisition,
stockholders' equity of the two companies were as follows:
Popsters
1,050,000
SG
Share Capital
Retained Earnings
240,000
1,560,000
420,000
On December 31, 2020, Subsidiary reported net income of P105,000 and paid dividends of P36,000 to Parent.
Parent reported earnings from its separate operations of P285,000 and paid dividends of P138,000. Goodwill had
been impaired and should be reported at P6,000 on December 31, 2020.
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