ABC Corp., a Non-Resident Foreign Corporation (NRFC) bought 10,000 (PV Php 100) shares of stocks of XYZ Corp., aDomestic Corporation (DC) in the amount Php 1 Million in 2010. On September 12, 2021, ABC Corp. sold the shares ofstock to DEF Corp., a Domestic Corporation for Php 2 Million.ChoicesPhp 150,000Php 600,000Php 300,000Php 250,000 GRADUATED TAX TABLE UNDER TRAIN LAW (January 1, 2018 to December 31, 2022)OverBut not over The Tax shall bePlus of Excess Over250,000250,000400,00020%250,000400,000800,00030,00025%400,000800,0002,000,000130,00030%800,0002,000,000 8,000,000490,00032%2,000,0008,000,0002,410,00035%8,000,000

A non-resident is a person who does not live within the country but would be taxable by the country.…

Answered: ABC Corp., a Non-Resident Foreign…

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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Cheyenne Ltd. is a Canadian publicly-traded business with a December 31 fiscal year end. In order to get a better return on some of its excess cash, Cheyenne purchased 130 common shares of AFS Corporation on July 1, 2023 at a price of $3 per share. Due to the nature of the investment, Cheyenne's management is accounting for the equity investment using the fair-value through other comprehensive income (FV-OCI) without recycling to net income. On August 1, 2023, AFS declared dividends of $2/share, and paid those dividends on August 20, 2023. On December 31, 2023, shares in AFS were trading at $5 per share. On September 15, 2024, Cheyenne sold the shares in AFS for $6 per share. Prepare the journal entries required to record the above transactions on the books of Cheyenne Ltd. (Credit account titles are automatically indented when the 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. List all debit…
On july 16, 2021, Empe exchanged a land for 15,000 ordinary shares of RH corporation to be held for trading. On this date, the carrying amount of the land was P1,200,000 and the fair value was P1,650,000. On this date, the carrying amount of RH's share was P75 and the market value was P125. On October 17, 10,000 of these share were sold at P135. The market price at year end is P142. The entry made by your client with regards to the above investment upon acquisition was: DEBIT: Trading securities-RH-P1,200,000 CREDIT: Land-P1,200,000 Upon sale: DEBIT: Cash-P1,350,000 CREDIT: Trading securities-P1,350,000 What amount should be presented in the statement of financial position on December 31, 2021 for the investment related to RH? Compute the unrealized gain or loss that should be reported in the income statement at yearend. ( If loss, put a negative (-) sign before the numerical figure)
Canada Goose, a Canadian publicly traded company, purchased 20% of Feather Ltd's common shares for $450,000 cash on January 3, 2022. During the year, Feather reported net income of $700,000 and declared and paid dividends of $80,000. The investment's fair value on December 31, 2022, was $550,000, the company's year-end. On January 1, 2022, Canada Goose had a cash and retained earnings balance of $2,000,000. Required: Assuming Canada Goose has significant influence over Feather Ltd, prepare, in good format, the relevant parts of Canada Goose's Statement of Financial Position.
On January 1, 2021, PARKSOOYOUNG acquired all the outstanding shares of SUNGJAE for P600,000. The shareholders’ equity of SUNGJAE on this date amounted to P600,000. The net assets of SUNGJAE on this day were fairly valued except for inventories which were overstated by P50,000, equipment which was understated by P75,000, and building which was overstated by P125,000. Only half of the inventories were sold during 2021. The useful lives of the equipment and the building at the beginning of 2021 were 3 years and 5 years remaining, respectively. On December 31, 2021, the statements of financial position of PARKSOOYOUNG and SUNGJAE are as follows: How much is the consolidated total assets as of December 31, 2021? a. 4,250,000 b. 4,125,000 c. 4,275,000 d. 4,150,000
On July 15, 2021, Max Co. acquired 25,000 shares of Chicken Co. for P250,000 which includes P1 cash dividend per share to shareholders of record as of July 30, 2021. Max Co does not have significant influence over Chicken Co. The entity also spent additional P5,000 transaction cost. The dividend was received by Max Co. on August 15, 2021. On November 15, 2021, the Max Co. sold 10,000 shares for P10.5/share. At year- end, Chicken Co.'s shares were selling at P12 per share.
On January 1, 2021, ABC Co. acquired all of the identifiable assets and assumed all of the liabilities of XYZ, Inc. by issuing its own ordinary shares. Information at acquisition date is shown below: Additional information: 1. ABC Co's share capital consists of 60,000 ordinary shares with par value of ₱40 per share. 2. XYZ's share capital consists of 3,000 ordinary shares with par value of ₱400 per share. A) how many shares were issued in the business combination? B) how much is the acquisition-date fair value per share?
On March 15, 2021, Smith Corp. (Smith) purchased 18,000 common shares of Costa Inc. (CI) for $72,000, plus transaction costs of $6,000. Smith elected to record the shares of Cl at fair value through other comprehensive income. On July 15, 2021, Smith received a $1.50 per share dividend. At December 31, 2021, the fair value of Cl's shares was $7.00 per share. On February 15, 2022, all the shares of CI were sold for $12.00 per share due to the favourable market rate of the shares. Smith's policy is to transfer the net balance of accumulated other comprehensive income to retained earnings upon derecognition of the investment in Cl's shares. Smith reports under IFRS. Required: a) Prepare all journal entries necessary for the investment-related transactions in 2021. b) Prepare all journal entries necessary for the sale of the shares on February 15, 2022.
MANGO Company acquired 4,000 shares of KIWI Corporation ordinary shares on April 2, 2020 at a cost of ₱440,000 to be held for trading. On October 7, 2020, KIWI distributed a 10% ordinary share dividend when the market price of the shares was ₱125 per share. On December 15, 2020, MANGO sold 400 shares of its KIWI shares for ₱64,000. For the year ended, December 31, 2020, how much should MANGO report as gain or loss on sale of investment?
Runner Corporation, which reports under IFRS, has the following investments at December 31, 2024: 2. 3. 4. Trading investments: common shares of National Bank, cost $36,500, fair value $43,400. Investment in an associate (40% ownership): common shares of Sword Corp., cost $218,200, fair value cannot be determined because the shares do not trade publicly. Runner purchased the investment on January 1, 2024. For the year ended December 31, 2024, Sword Corp. reported net income of $46,600 and declared and paid dividends of $15,800. Equity investment: common shares of Epee Inc. (19% ownership) purchased on July 1, 2024, cost $423,300, fair value at December 31, 2024, $545,200. Management intends to purchase more shares of Epee in two years. Epee earned $39,900 for the year ended December 31, 2024, and declared and paid dividends of $1,800, which Runner received at the end of each quarter in 2024. Bond investment to be held to maturity: bonds of Ghoti Ltd., purchased at a cost equal to its…
BTS Co. was incorporated on January 1, 2021. The following were the transactions during the year:• Total consideration from share issuances amounted to ₱4,000,000.• A land and building were acquired through a lump sum payment of ₱800,000. A mortgage amounting to ₱200,000 was assumed on the land and building. • Total payments of ₱160,000 were made during the year on the mortgage assumed on the land and building. The payments are inclusive of interest amounting to ₱20,000. • Additional capital of ₱400,000 was obtained through bank loans. None of the bank loans were paid during the year. Half of the bank loans required a secondary mortgage on the land and building. • There is no accrued interest as of year-end. • Dividends declared during the year but remained unpaid amounted to ₱120,000. • No other transactions during the year affected liabilities.• Retained earnings as of December 31, 2021 is ₱240,000.How much is the total assets as of December 31, 2021?How much is the profit for the…
On January 1, 2021, ABC Co. acquired all of the identifiable assets and assumed all of the liabilities of XYZ, Inc. by issuing its own ordinary shares. Information at acquisition date is shown below: (see image below) Additional information: 1. ABC Co's share capital consists of 60,000 ordinary shares with par value of ₱40 per share. 2. XYZ's share capital consists of 3,000 ordinary shares with par value of ₱400 per share. how much is the gain on acquisition or goodwill to be recognized? what is the retained earnings of the combined entity immediately after the business combination?
On January 1, 2021, PARKSOOYOUNG acquired all the outstanding shares ofSUNGJAE for P600,000. The shareholders’ equity of SUNGJAE on this dateamounted to P600,000. The net assets of SUNGJAE on this day were fairly valuedexcept for inventories which were overstated by P50,000, equipment which wasunderstated by P75,000, and building which was overstated by P125,000. Only half ofthe inventories were sold during 2021. The useful lives of the equipment and thebuilding at the beginning of 2021 were 3 years and 5 years remaining, respectively.On December 31, 2021, the statements of financial position of PARKSOOYOUNGand SUNGJAE are as follows:PARKSOOYOUNG SUNGJAECash 300,000 300,000Inventory 400,000 250,000Equipment 1,000,000 900,000Building 600,000 500,000Liabilities 1,100,000 500,000Share capital 600,000 600,000Retained earnings 600,000 850,000How much is the consolidated total assets as of December 31, 2021? A. 4,125,000B. 4,250,000C. 4,150,0004, D. 275,000

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ABC Corp., a Non-Resident Foreign Corporation (NRFC) bought 10,000 (PV Php 100) shares of stocks of XYZ Corp., a Domestic Corporation (DC) in the amount Php 1 Million in 2010. On September 12, 2021, ABC Corp. sold the shares o stock to DEF Corp., a Domestic Corporation for Php 2 Million.