Answered: Case 2: the Investment Held for Trading…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

Case 2: the Investment Held for Trading Securities account in the book of Tatay (acquired in
2020) represents 30% ownership interest in Walanay, Inc. Walanay subsequently reacquires
50% of its outstanding shares from other investors. The previously held equity of Tatay have a
fair value of three times its book value now. Tatay elected to measure NCI at ‘proportionate
share’.
With the stated facts, answer the following:
1.How much is the Consideration Transferred?
a. P 1,350,000.00
b. P 1,900,000.00
c. P 1,750,000.00
d. P 1,800,000.00
2.How much is the Non-Controlling Interest in the acquiree?
a. P 0.00
b. P 150,000.00
c. P 684,000.00
d. P 1,200,000.00
3.How much is the Fair Value of the previously held equity interest in the acquiree?
a. P 0.00
b. P 540,000.00
c. P 450,000.00
d. P 500,000.00

TATAY CO.
WALANAY, INC.
Asset
Petty Cash Fund
Cash In bank
10,000.00
10,000.00
700,000.00
800,000.00
Receivables
490,000.00
250,000.00
Inventory
500,000.00
150,000.00
Investment held for Trading Securities
450,000.00
Building
1,300,000.00
850,000.00
Goodwill
250,000.00
140,000.00
Total Assets
3,700,000.00
2,200,000.00
Liability and Equity
Liabilities
750,000.00
350,000.00
Share Capital
1,900,000.00
1,000,000.00
Share Premium
650,000.00
530,000.00
Ret ained Earnings
400,000.00
320,000.00
Total Liabilit y and Equity
3,700,000.00
2,200,000.00

Expert Solution

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions