On July 1, 2020, Matcha, Inc. acquired as a long-term investment for P1,600,000, a 40% interest in Milk Tea Company when the fair value of Milk Tea’s net assets was P4,000,000. Due to the COVID-19 pandemic, Milk Tea Company experienced difficulty in continuing its business and reported the following net losses: 2020- P1,000,000 2021- P1,400,000 2022- P1,800,000 2023- P800,000 What amount should be reported as share in loss from investment in associate for the year 2023? a. P320,000 b. P280,000 c. P120,000 d. P80,000
On July 1, 2020, Matcha, Inc. acquired as a long-term investment for P1,600,000, a 40% interest in Milk Tea Company when the fair value of Milk Tea’s net assets was P4,000,000. Due to the COVID-19 pandemic, Milk Tea Company experienced difficulty in continuing its business and reported the following net losses: 2020- P1,000,000 2021- P1,400,000 2022- P1,800,000 2023- P800,000 What amount should be reported as share in loss from investment in associate for the year 2023? a. P320,000 b. P280,000 c. P120,000 d. P80,000
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
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 11P
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On July 1, 2020, Matcha, Inc. acquired as a long-term investment for P1,600,000, a 40% interest in Milk Tea Company when the fair value of Milk Tea’s net assets was P4,000,000. Due to the COVID-19 pandemic, Milk Tea Company experienced difficulty in continuing its business and reported the following net losses:
- 2020- P1,000,000
- 2021- P1,400,000
- 2022- P1,800,000
- 2023- P800,000
What amount should be reported as share in loss from investment in associate for the year 2023?
a. P320,000
b. P280,000
c. P120,000
d. P80,000
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