Rome Inc. acquired 50,000 ordinary shares of Egypt Company at P120 per share. On February 14, 2020, Rome Inc. received 50,000 stock rights entitling it to buy one new share at P90 for every two rights held. On February 14, 2020, the market value of each share is P130 while that of each right is P20. On March 1, 2020, all the stock rights were exercised. If share rights are accounted for separately, what is the total cost of the new investment in ordinary shares acquired?

Q: On January 2, 2020, Gamu Company purchased as a long term investment 10,000 ordinary shares of…

A: Solution: Cost of investment for Gamu = 10000*P70 = P700,000 Sale value of investment for Gamu =…

Q: 5. On June 1, 2020, Ping Corp. purchased 10,000 of Pong’s 50,000 outstanding shares at a price of…

A: solution given Date of purchase of share June 1 2020 Number of total share of pong 50000…

Q: On June 15, 2021, LABAN Company owns 20,000 shares with a cost of P1,000,000 of GANGDULO Company’s…

A: On 15.06.2021, LABAN company owns shares of GANGDULO company = 20000 shares Cost of purchase =…

Q: Marcus Company made the following transactions in the ordinary shares of Cato Company designated as…

A: Capital gain or capital loss is incurred on the sale of capital asset of an individual. Capital gain…

Q: TOOLAD Company agreed agreed to pay P850,000 cash and issue 50,000 shares of its P10 par (20 current…

A: A business combination occurs when an entity acquires control over an organization. Control means…

Q: On December 31, 2020, R papa Company, an entity with no subsidiary, purchased 10,000 ordinary shares…

A: An investment in other entity can be recorded using two methods; 1) Fair value method, and 2) Equity…

Q: TOOLAD Company agreed agreed to pay P850,000 cash and issue 50,000 shares of its P10 par (20 current…

A: Step 1 In business combination, when the number of shares is issued, they are generally issued   at…

Q: On January 1, 2020, PQR Company purchased 40,000 shares of Frank, Inc. at P100 per share. The…

A: Initial measurement of investment: Initially, the value of an investment property is determined by…

Q: TOOLAD Company agreed agreed to pay P850,000 cash and issue 50,000 shares of its P10 par (20 current…

A: A business combination occurs when an entity acquires control over an organization. Generally, the…

Q: MANGO Company acquired 4,000 shares of KIWI Corporation ordinary shares on April 2, 2020 at a cost…

A: The trading investment is recognized at FVTPL and any changes in their fair value are recognized in…

Q: Marcus Company made the following transactions in the ordinary shares of Cato Company designated as…

A: Assets at fair value through profit or loss (FVTPL) can be defined as the financial assets that are…

Q: What amount of unrealized gain should Sisig Corp. report in its December 31, 2020 Statement of…

A: Unrealized gain is the gain which has been earned by the company when the investment is measured at…

Q: On January 2, 2020, Theodora Company purchased 40,000 shares of Byzantine, Inc. stock at P100 per…

A: Solution: Cost of the investment = Purchase cost + brokerage - dividend  = 40000*100 + 120000 -…

Q: During the year 2021,David Company purchased 1,000 shares of Goliath Company ordinary shares at P150…

A: The shares designated to be valued at fair value through other comprehensive income are to be…

Q: On December 31, 2019, Kier Corporation purchased 30,000 shares of Lord Company's shares at P100…

A: When the shareholder of an entity is given an invitation to purchase more or additional shares of…

Q: Pangan Corp. acquired 4,000 shares of Agustin, Inc. ordinary shares on Oct. 20, 2018 for P660,000.…

A: Answer with explanation are as follows

Q: Pascual Corp. owned 20,000 ordinary shares of Alegrado Corp., purchased in 2018 for P1,800,000. On…

A: The questions are multiple choice questions. Required  Choose the Correct Option.

Q: Princess Corp. purchased 100,000 ordinary shares at P80 per share on January 1, 2020. These shares…

A: The ordinary shares means the shares whose shareholders have the right to participate in the…

Q: In 2020, ION Corporation issued 50,000 shares of P10 par value for P100 per share. In 2021, the…

A: Reacquisition of shares means when shares of the company are being repurchased or reacquired by the…

Q: During the year 2021, David Company purchased 1,000 shares of Goliath Company ordinary shares at…

A: The shares designated to be valued at fair value through other comprehensive income are to be…

Q: 1.)During the year 2021,David Company purchased 1,000 shares of Goliath Company ordinary shares at…

A: 1) Holding gain should David report in equity on Dec 31, 2021 :- 1,000 ordinary shares of Goliath…

Q: Heidebrecht Design acquired 30% of the outstanding common stock of Oriole Company on January 1,…

A: 1) journal entries for Heidebrecht Design for 2020 assuming Heidebrecht Design cannot exercise…

Q: On January 1, 2021, Kendall Inc. purchased 25,000 shares of Kylie Company at a cost per share of…

A: If a company purchases more than 20% stocks of the other company and has significant influence over…

Q: On December 31, 2019, Kier Corporation purchased 30,000 shares of Lord Company's shares at P100…

A: Given that the Kier corporation holds 30,000 shares in Lord company.  Kier corporation Rights=…

Q: For the next (2) two questions: STU Company purchased 10,000 shares representing 2% ownership of…

A: The income statement of a company represents the outcome of the operations of the business in terms…

Q: On June 1, 2020, Ping Corp. purchased 10,000 of Pong's 50,000 outstanding shares at a price of P6.00…

A: The correct statement is

Q: On December 31, 2020, Melon Co. was registered at SEC with 100,000 authorized ordinary shares of…

A: Par value of ordinary shares issued = No. of ordinary shares issued x Par value per share = 40,000 x…

Q: ethod and assume that Walter ordinary shares should be classified as a trading security. (Use “FVTPL…

A: a) In the books of M/s Control Alt Deign Journal     Date Particulars Dr($) Cr($) 1 Jan 2020…

Q: On January 2, 2020, Theodora Company purchased 40,000 shares of Byzantine, Inc. stock at P100 per…

A: It is pertinent to note that transaction costs incurred for equity instruments designated at fair…

Q: On December 20, 2018, Ball Corporation purchased 30,000 shares of Pencil Company's shares at P100…

A: Trading securities are the securities in which the entity invests and held them for selling in the…

Q: On January 1, 2020, Alpha Aviation issues 105,000 shares of stock. Shortly thereafter, Delta Tech…

A: Dividend refers to the profit distribution to its shareholders and when the business earns the…

Q: Harrison Co. owns 20,000 of the 50,000 outstanding ordinary shares of Taylor, Inc. During 2021,…

A: The holding of share are considered as the investment and the  balance of investment can be…

Q: On February 1,2020, Neversaynever Corporation declared a bonus issue entitling its shareholders to…

A: Bonus shares are the shares which are issued to the existing shareholders free of charge. These are…

Q: On January 1, 2019, Blackpink Company purchased 50,000 shares of another entity for P3,600,000. On…

A: Given information, Number of shares purchased =50,000 Stock rights received = 50,000   Investment…

Q: On January 2, 2020, Theodora Company purchased 40,000 shares of Byzantine, Inc. stock at P100 per…

A: Solution:Total cost of investment = Purchase cost + Brokerage fee - dividend= 40000*100 + 120000 -…

Q: On January 2, 2020, Theodora Company purchased 40,000 shares of Byzantine, Inc. stock at P100 per…

A: Solution:Total cost of investment = Purchase cost + Brokerage fee - dividend= 40000*100 + 120000 -…

Q: 1. How much is the income recognized upon receipt of share rights? a. P0  b. P10,000 c. P20,000  d.…

A: On April 5. 2020, Paul Company purchased P50 par, 10,000 ordinary shares of George Company at P80…

Q: On January 2, 2020, Theodora Company purchased 40,000 shares of Byzantine, Inc. stock at P100 per…

A: Cost of Shares purchased : = 40000 shares * P100 per share  = 4000000   Brokerage Fees : 120000…

Q: how much should MANGO report as gain or loss on sale of investment?

A: The management sometimes invests in the stock market to acquire other corporations' shares for the…

Q: Nakeeta company owned 50,000 ordinary shares which were purchased for P120 per share. During the…

A: Right issue gives right to the existing shareholders for purchase of shares at a discounted price or…

Q: TJH Corp organized on January 1, 2019, at which date it issued 200,000 shares of P10 par ordinary…

A: Tje shareholders' equity section represents the total equity belongings to shareholders.

Q: ILA Company agreed to pay $850,000 cash and issue 50,000 shares of its $10 par (20 current fair…

A: Step 1 In business combination, when the number of shares is issued, they are generally issued   at…

Q: For the next (2) two questions: STU Company purchased 10,000 shares representing 2% ownership of…

A: The journal entries can be defined as the base of accounting because the business transaction is…

Q: Solomon Company owned 20,000 shares of Moses Company purchased in 2015 for P2,400,000. On December…

A: Property Dividends given = 20,000 / 10 = 2000 shares

Q: On December 1, 2020, Citrus purchased 200.000 shares representing 45 percent of the outstanding…

A: Solution: Citrus long term investment in Berry should be shown in Citrus December 31, 2020,…

Q: On April 1, 2023, Dark Company purchased P50 par, 10,000 ordinary shares of Vader Company at P80 per…

A: Right Issue: Existing shareholders are invited to acquire extra new shares in the firm through a…

Q: On December 31, 2019, Akron, Inc., purchased 5 percent of Zip Company's common shares on the open…

A: Investment Accounting: When money is paid for an investment instrument, investment accounting takes…

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.