Entity G acquired a 40% interest in Pokus Corp. for P1,700,000 on January 1,2021. The shareholders' equality of Pokus Corp. on January 1 and December 31, 2021 is presented below: Share capital (January 1) P3,000,000 (December 31) P3,000,000 Revaluation surplus (January 1) - (December 31) P1,300,000 Retained earnings (January 1) P1,000,000 (December 31) P1,500,000 On January 1, 2021, all the identifiable assets and liabilities of Pokus Corp. were recorded at fair value. Pokus Corp. reported profit before income tax of P1,000,000 and paid dividends of P150,000 to shareholders during the current year. The tax rate is 35% The revaluation surplus is the result of the revaluation of land recognized by Pokus Corp. on December 31,2021. Pokus presents other comprehensive income net of applicable income tax. Additionally, depreciation is provided by Pokus Corp. on the diminishing balance method whereas Entity G uses the staright-line. Had Pokus Corp. used the straight line, the acuumulated depreciation would be increased by P200,000. Enity G should report its investment in associate on December 1,2021 at a. P2,238,000 b. P2,290,000 c. P2,420,000 d. P2,560,000
Entity G acquired a 40% interest in Pokus Corp. for P1,700,000 on January 1,2021. The shareholders' equality of Pokus Corp. on January 1 and December 31, 2021 is presented below:
Share capital (January 1) P3,000,000 (December 31) P3,000,000
Revaluation surplus (January 1) - (December 31) P1,300,000
On January 1, 2021, all the identifiable assets and liabilities of Pokus Corp. were recorded at fair value. Pokus Corp. reported profit before income tax of P1,000,000 and paid dividends of P150,000 to shareholders during the current year. The tax rate is 35%
The revaluation surplus is the result of the revaluation of land recognized by Pokus Corp. on December 31,2021. Pokus presents other comprehensive income net of applicable income tax.
Additionally,
Enity G should report its investment in associate on December 1,2021 at
a. P2,238,000
b. P2,290,000
c. P2,420,000
d. P2,560,000
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