Pi Company owns 85% interest in So Company. During the year, Pi Company reported net income of P200,000 and paid cash dividends of P150,000. So Company reported a net income of P80,000 and paid cash dividends of P40,000. During the year, So Company sold merchandise costing P37,500 to Pi Company at a price that yields a 25% gross profit rate. Pi Company reported that 20% of the shipment from So Company are on hand at December 31. Loss on impairment of goodwill during the year is P10,000. The parent is using full goodwill approach in measuring NCI. The net income attributable to NCI is:
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- Problem 2: On Jan 1, 20X8, Banawe Company purchased 80% of the outstanding shares of Malate Company at a cost of P4,000,000. On that date, Malate had P2,500,000 of capital stock and P3,500,000 of retained earnings. For 20X8, Banawe had income of P1,400,000 form its separate operations and paid dividends of P750,000. Malate on the other hand reported income of P325,000 and paid dividends of P150,000 on December 1, 20X8. All the assets and liabilities of Malate have book values equal to their fair market values. Assume all income was earned evenly throughout the year except for an intercompany transaction on October 1, 20X8 when Banawe purchased a machinery from Malate for P500,000. The book value of the machinery on that date amounted to P600,000 and accumulated depreciation of P400,000 and is already reflected in the income of Malate indicated above. The machinery is expected to have a remaining useful life of 5 years from the date of sale. In the December 31, 20X8 consolidated…Exercise 4 – 7On January 1, 2020, Levesque Co. purchased 500,000 ordinary shares of Rowland Co. at ₱14 per share, representing a 25% ownership in Rowland. This allowed Levesque to exercise significant control over Rowland. Rowland declared and paid dividends of ₱1 and ₱2 in 2020 and 2021, respectively. At the end of 2020 and 2021, Rowland’s shares were trading at ₱15 and ₱17 per share. Rowland’s net income in 2020 and 2021 was ₱2,400,000 and ₱3,200,000, respectively.1. Determine the investment income recognized by Levesque in 2020 and 2021.2. Determine the carrying amount of Levesque’s investment on December 31, 2020, and December 31, 2021.Harvatin Group reported net income totaling $1,000,000 for the year 2006. The following is EXERCISE 6-4 additional information obtained from the Harvatin Group's financial reports: The Company purchased 100,000 shares of Micron Specialists for $10 per share during the fourth quarter of 2006. The investment is accounted for as "available for sale." The value of the shares is $9 at the end of 2006. The Company purchased 10,000 shares of Sunswept Properties for $20 per share during the fourth quarter of 2006. The investment is accounted for as "trading" securities. The value of the shares is $22 at the end of 2006. The company began operations in the Baltic region of Europe during the year and reports a foreign currency translation gain at the end of 2006 totaling $50,000. The decrease in the net pension assets for the year was $175,000. However, the periodic pension expense reported in the income statement was only $100,000. The company reported unrealized holding losses on…
- Situation 1Oriole Cosmetics acquired 10% of the 191,000 shares of common stock of Martinez Fashion at a total cost of $14 per share on March 18, 2020. On June 30, Martinez declared and paid $69,200 cash dividend to all stockholders. On December 31, Martinez reported net income of $116,000 for the year. At December 31, the market price of Martinez Fashion was $15 per share.Situation 2Waterway, Inc. obtained significant influence over Seles Corporation by buying 40% of Seles’s 28,500 outstanding shares of common stock at a total cost of $9 per share on January 1, 2020. On June 15, Seles declared and paid cash dividends of $38,100 to all stockholders. On December 31, Seles reported a net income of $78,200 for the year.Prepare all necessary journal entries in 2020 for both situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) PLEASE HELP.…Situation 1Waterway Cosmetics acquired 10% of the 189,000 shares of common stock of Martinez Fashion at a total cost of $12 per share on March 18, 2020. On June 30, Martinez declared and paid $77,300 cash dividend to all stockholders. On December 31, Martinez reported net income of $122,300 for the year. At December 31, the market price of Martinez Fashion was $13 per share.Situation 2Wildhorse, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles’s 32,100 outstanding shares of common stock at a total cost of $9 per share on January 1, 2020. On June 15, Seles declared and paid cash dividends of $32,700 to all stockholders. On December 31, Seles reported a net income of $78,800 for the year.Prepare all necessary journal entries in 2020 for both situations.Question 32 On January 1, 2013, Pansy Company acquired a 10% interest in Sunflower Corporation for $80,000 when Sunflower's stockholders' equity consisted of $400,000 capital stock and $100,000 retained earnings. Book values of Sunflower's net assets equaled their fair values on this date. Sunflower's net income and dividends for 2013 through 2015 were as follows: 2013 2014 2015 Net income $ 8,000 $ 10,000 $15,000 Dividends paid 5,000 5,000 5,000 Assume that Pansy Incorporated used the cost method of accounting for its investment in Sunflower. The balance in the Investment in Sunflower account at December 31, 2015 was Answers: A. $76,700. B. $95,000. C. $80,000. D. $83,300. Question 33…
- 4. Pate Corp. owns 80% of Strange Inc.’s common stock. During 20X1, Pate sold inventory to Strange for $600,000 on the same terms as sales made to outside customers. Strange sold the entire inventory purchased from Pate by the end of 20X1. Pate and Strange report the following for 20X1. Pate Strange Sales $ 2,700,000 $ 1,600,000 Cost of sales 1,800,000 900,000 Gross profit $ 900,000 $ 700,000 Required: What amount should Pate report as sales revenue in its 20X1 consolidated income statement? What amount should Pate report as cost of sales in its 20X1 consolidated income statement? Amount a. Sales Revenue Amount $ b. Cost of sales amount $PROBLEM 28 (AICPA Adapted)Miraflores owned 10,000 shares in Maquiling Company acquired several years ago at P100 per share to be held as a long-term investment. Beginning in 2015, Miraflores received a dividend of P40 pershare. Maquiling Company notifies the investor that a portion of this amount represented earnings and the balance as liquidating dividends. The allocation to be made as follows: Earned Dividend Liquidating Dividend2015 - P402016 P10 P302017 P15 P252018 P20 P202019 P25 P15 Requirements:1. Prepare journal entries on the books of…JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the common stock is $.10) JE 2 PizzaPan Inc. purchased $200,000 inventory from a culinary distributor. PizzaPan inc. had to pay at the point of purchase the full $200,000 (cash). JE 3 PizzaPan Inc. purchased a delivery truck for $40,000 (cash). JE 4 PizzaPan Inc. sold on account 10,000 pizza pans to Domino’s Corporation. They sold the pans for $5/each. The cost of each pan is $3 ($3/each). JE 5 PizzaPan Inc. sold on account 5,000 pizza cutters to PizzaHut Corporation. They sold the pizza cutters for $8/each. The cost of each pizza cutter is $4 ($4/each). JE 6 PizzaPan Inc. paid their employees as follows: Sales staff => $12,000 Administrative staff => $16,000 JE 7 PizzaPan Inc. received $50,000 payment from Domino’s Corporation. Prepare an Income Statement. Prepare a Retained Earnings Statement Prepare a Balance Sheet
- JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the common stock is $.10) JE 2 PizzaPan Inc. purchased $200,000 inventory from a culinary distributor. PizzaPan inc. had to pay at the point of purchase the full $200,000 (cash). JE 3 PizzaPan Inc. purchased a delivery truck for $40,000 (cash). JE 4 PizzaPan Inc. sold on account 10,000 pizza pans to Domino’s Corporation. They sold the pans for $5/each. The cost of each pan is $3 ($3/each). JE 5 PizzaPan Inc. sold on account 5,000 pizza cutters to PizzaHut Corporation. They sold the pizza cutters for $8/each. The cost of each pizza cutter is $4 ($4/each). JE 6 PizzaPan Inc. paid their employees as follows: Sales staff => $12,000 Administrative staff => $16,000 JE 7 PizzaPan Inc. received $50,000 payment from Domino’s Corporation. I couldnt figure out the retained earnings in the T-account.JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the common stock is $.10) JE 2 PizzaPan Inc. purchased $200,000 inventory from a culinary distributor. PizzaPan inc. had to pay at the point of purchase the full $200,000 (cash). JE 3 PizzaPan Inc. purchased a delivery truck for $40,000 (cash). JE 4 PizzaPan Inc. sold on account 10,000 pizza pans to Domino’s Corporation. They sold the pans for $5/each. The cost of each pan is $3 ($3/each). JE 5 PizzaPan Inc. sold on account 5,000 pizza cutters to PizzaHut Corporation. They sold the pizza cutters for $8/each. The cost of each pizza cutter is $4 ($4/each). JE 6 PizzaPan Inc. paid their employees as follows: Sales staff => $12,000 Administrative staff => $16,000 JE 7 PizzaPan Inc. received $50,000 payment from Domino’s Corporation. 1. Prepare closing entries. 2. Compare final closing entry to net income. Explain why the dollar amounts are…JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the common stock is $.10) JE 2 PizzaPan Inc. purchased $200,000 inventory from a culinary distributor. PizzaPan inc. had to pay at the point of purchase the full $200,000 (cash). JE 3 PizzaPan Inc. purchased a delivery truck for $40,000 (cash). JE 4 PizzaPan Inc. sold on account 10,000 pizza pans to Domino’s Corporation. They sold the pans for $5/each. The cost of each pan is $3 ($3/each). JE 5 PizzaPan Inc. sold on account 5,000 pizza cutters to PizzaHut Corporation. They sold the pizza cutters for $8/each. The cost of each pizza cutter is $4 ($4/each). JE 6 PizzaPan Inc. paid their employees as follows: Sales staff => $12,000 Administrative staff => $16,000 JE 7 PizzaPan Inc. received $50,000 payment from Domino’s Corporation. Post the above journal entries to “T” accounts. Prepare a trial balance using the “T” account balances.