PROBLEM 34 On January 1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000. The 10,000 shares are equivalent to 20% interest of the investee. JKL Company reported the following net income or loss: 2020 - P1,000,000 2021 - (P5,000,000) 2022 - P300,000 Requirements: 1. Prepare the necessary journal entries to record the share of income or loss in 2020, 2021, and 2022. 2. What is the carrying value of the investment on December 31, 2020? December 31, 2021? December 31, 2022
PROBLEM 34 On January 1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000. The 10,000 shares are equivalent to 20% interest of the investee. JKL Company reported the following net income or loss: 2020 - P1,000,000 2021 - (P5,000,000) 2022 - P300,000 Requirements: 1. Prepare the necessary journal entries to record the share of income or loss in 2020, 2021, and 2022. 2. What is the carrying value of the investment on December 31, 2020? December 31, 2021? December 31, 2022
Accounting (Text Only)
26th Edition
ISBN:9781285743615
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 15.28EX
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PROBLEM 34
On January 1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000. The 10,000 shares are equivalent to 20% interest of the investee. JKL Company reported the following net income or loss:
2020 - P1,000,000
2021 - (P5,000,000)
2022 - P300,000
Requirements:
1. Prepare the necessary
2. What is the carrying value of the investment on December 31, 2020? December 31, 2021? December 31, 2022?
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