ABC Company , a holder of P1,000,000 XYZ Company bonds, collected the interest due on March 31, year 1, and then sold the bonds to W, Inc. for P975,000. On that date, XYZ, a 75% owner of W had P1,075,000 carrying amount for the bonds. What was the effect of W's purchase of XYZ's bond on the noncontrolling interest amount reported in XYZ's March 31, year 1 consolidated balance sheet? ABC Company , a holder of P1,000,000 XYZ Company bonds, collected theinterest due on March 31, year 1, and then sold the bonds to W, Inc. for P975,000.On that date, XYZ, a 75% owner of W had P1,075,000 carrying amount for thebonds. What was the effect of W's purchase of XYZ's bond on the noncontrollinginterest amount reported in XYZ's March 31, year 1 consolidated balance sheet?

A company that purchases the majority of shares (i.e substantial interest) in another company than…

Answered: ABC Company , a holder of P1,000,000…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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ABC Company , a holder of P1,000,000 XYZ Company bonds, collected the interest due on March 31, year 1, and then sold the bonds to W, Inc. for P975,000. On that date, XYZ, a 75% owner of W had P1,075,000 carrying amount for the bonds. What was the effect of W's purchase of XYZ's bond on the noncontrolling interest amount reported in XYZ's March 31, year 1 consolidated balance sheet?

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