How much is the non-controlling interest in the net assets of the subsidiary on December 31, 2021? On January 1, 2021, Bass Co. issued equity instruments in exchange for 75% interest in Guitar Co. On acquisition date,Bass Co. elected to measure non-controlling interest at fair value. Bass Co.'s management believes that the fair value ofthe consideration transferred correlates to the fair value of the controlling interest acquired and that the fair value ofthe controlling interest is proportionate to the fair value of the remaining interest.Guitar Co.'s net identifiable assets have carrying amount and fair value of P300,000 and P360,000, respectively. Thedifference is attributable to a building with a remaining useful life of 6 years.The December 31, 2021 statements of financial position of Bass Co. and Guitar Co. are summarized below:Bass Co.Guitar Co.ASSETSInvestment in subsidiary (at cost)300,000Other assets1,372,0001,672,000496,000TOTAL ASSETS496,000LIABILITIES AND EQUITYTrade and other payables292,000120,000Share capitalRetained earningsTotal equityTOTAL LIABILITIES AND EQUITY940,000200,000440,000176,0001,380,000376,0001,672,000496,000No dividends were declared by either entity during year. There were also no inter-company transactions and impairmentin goodwill. How much is the non-controlling interest in the net assets of the subsidiary on December 31, 2021?

Answered: How much is the non-controlling…

Business

Accounting

How much is the non-controlling interest in the net assets of the subsidiary on December 31, 2021?

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

Q: Assume on July 1, 2022, a parent company paid $1,656,000 to purchase an 80% interest in a…

A: The Goodwill is the amount of purchase consideration paid in excess of fair value of net…

Q: Illustration 2. Non-Controlling Interest On January 1, 2021, Inahan Co. acquired 75% of the voting…

A: 1. Previously held equity untereat in the aquiree is a 0.00 since Inhaan Co. acquired 75% share on…

Q: Company Y purchases a controlling interest in Company Z on January 1, 2019. Which of the following…

A: Ans. C Company Y's Shareholders' Equity as well as Company Y's proportional share ofCompany Z's net…

Q: instruments in exchange for 75% interest in Titan Co. On acquisition date, Turtle Co. elected to…

A: Consolidated equity refers to the aggregate of the stakeholder's equity of the parent company as…

Q: On January 1, 2019, XYZ Co. issued equity instruments in exchange for 75% interest in ABC Co. On…

A: The question is based on the concept of Consolidated Financial Statements. As per the Bartleby…

Q: On January 1, 20x1, ABC Company acquired 80% of XYZ Company's common stock for 275,000 cash. At that…

A: Net income:- Net income is also considered as the net earnings of the business that represents money…

Q: 18. An entity, with an investment in debt securities carried as FVOCI, deemed its original business…

A: If the entity business model changed then the entity needs to reclassify its financial instrument. A…

Q: In a mid-year purchase when the subsidiary's books are not closed until the end of the year, the…

A: A consolidated financial statement is a group's financial statement that is presented as a single…

Q: Q1) When a company owns 50% or more of another company, accounting standards require that the owner…

A: SOLUTION- In general, the consolidation of financial statements requires a company to integrate and…

Q: In a "type C" sotck for assets acquisition the purchasing corporation acquires substantially all of…

A: Type C reorganization involves a purchasing corporation acquiring most of a target's assets using…

Q: How is the noncontrolling interest in a subsidiary company calculated as of the end of a reporting…

A: Definition: Non-controlling interest in a subsidiary company: The non-controlling interest does…

Q: Use the following to answer questions 8 through 10: On May 1, 2021, Jazzie Co. agreed to sell the…

A: SOLUTION- WORKING NOTE- GAIN ON ASSET SALE = ($80 MILLION - $ 48 MILLION)…

Q: What method must be used if FASB 94 prohibits full consolidation of a 70% owned subsidiary?

A: FASB 94 - This Statement amends ARB No. 51, Consolidated Financial Statements, to require…

Q: The Non-controlling interest using the full goodwill method should be reported at: A. 10,000…

A: Non controlling interest using the full goodwill method is calculated by multiplying the holding of…

Q: "IFRS 10 Consolidated Financial Statements states that there are few ways to ascertain if the…

A: Consolidated financial statements are prepared to report the financial information of two or more…

Q: Parent Company sells land with book value of P5,000 to Subsidiary Company for P6,000 in 2020.…

A: The question is multiple choice question Required Choose the Correct Option

Q: On January 1, 2019, XYZ Co. issued equity instruments in exchange for 75% interest in ABC Co. On…

A: All amounts are in P.

Q: Selected information from the separate and consolidated statements of financial position and…

A: The percent of non-controlling interest ownership in S Company as of December 31, 2019.

Q: On January 1, 2022, a Parent company has a debt outstanding that was originally issued at a discount…

A: If the debt was purchased at a premium, there will be a gain or loss from the constructive…

Q: Under PFRS9, reclassification of investment in equity securities: A. Is allowed as long as it is…

A: Introduction:- This question is related to the accounting treatment of investments in equity…

Q: Examine how do you treat the following items when X Ltd. is merging with Y Ltd. on 1st January 2023…

A: If both are not satisfied,X Ltd: (Rs)Business…

Q: Exercise 20-18 (Algorithmic) (LO. 1) On January 7, 2022, Martin Corporation acquires two properties…

Q: ubsidiary company issued $1,000,000 (face) 6 percent, five-year bonds to an unaffiliated company for…

A: Parent company acquires an 80% interest in its Subsidiary on January 1, 2020. On January 1, 2020,…

Q: a) Based on the above information, calculate the non-controlling interest as at 30 June 2019. b)…

Q: Hippo Co. is a holding company. It holds all the shares of Opco. Shareholder H holds all the shares…

A: According to the tax rules, a capital gain is calculated by deducting cost of the asset from its net…

Q: amount of the inventory that S Company purchased from P Company in the December 31, 2019…

A: As per the given information in the above question we must determine the carrying amount of the…

Q: In the year ended June 30 2021, Lorelai Ltd, a reporting entity, acquired the assets and assumed the…

A: When a company's ownership is acquired by another company, is is said to be an acquisition. When 2…

Q: When a subsidiary liquidates into the parent corporation, the subsidiary recognizes both gains and…

A: Please find the answer to the above question below:

Q: .IFRIC 17 Distribution of noncash assets to owner provides that at the end of each reporting period…

A: Dividend payable is the amount of the return which is to paid to the shareholders of the entity.

Q: On January 7, 2022, Martin Corporation acquires two properties from a shareholder solely in exchange…

A: The "basis" of an asset is what a person has paid for an asset together with money invested in an…

Q: On January 2, 2020, Popsters Corporation purchased 80% of SG Corporation's ordinary shares for…

A: Non-controlling interest is a form of minority ownership in which stockholders hold less than 50% of…

Q: In preparing the Subsidiary company's Income distribution schedule (IDS), how is the total amount…

A: Income distribution schedule is the frequency of scheduled distributions of dividends or capital…

Q: A Parent Company owns 100 percent of its Subsidiary. During 2021, the Parent company reports net…

A: Parent company is that company which has right to control other company. The other company is known…

Concept explainers

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.

Question

How much is the non-controlling interest in the net assets of the subsidiary on December 31, 2021?

On January 1, 2021, Bass Co. issued equity instruments in exchange for 75% interest in Guitar Co. On acquisition date,
Bass Co. elected to measure non-controlling interest at fair value. Bass Co.'s management believes that the fair value of
the consideration transferred correlates to the fair value of the controlling interest acquired and that the fair value of
the controlling interest is proportionate to the fair value of the remaining interest.
Guitar Co.'s net identifiable assets have carrying amount and fair value of P300,000 and P360,000, respectively. The
difference is attributable to a building with a remaining useful life of 6 years.
The December 31, 2021 statements of financial position of Bass Co. and Guitar Co. are summarized below:
Bass Co.
Guitar Co.
ASSETS
Investment in subsidiary (at cost)
300,000
Other assets
1,372,000
1,672,000
496,000
TOTAL ASSETS
496,000
LIABILITIES AND EQUITY
Trade and other payables
292,000
120,000
Share capital
Retained earnings
Total equity
TOTAL LIABILITIES AND EQUITY
940,000
200,000
440,000
176,000
1,380,000
376,000
1,672,000
496,000
No dividends were declared by either entity during year. There were also no inter-company transactions and impairment
in goodwill. How much is the non-controlling interest in the net assets of the subsidiary on December 31, 2021?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 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

What is the amount of income attributable to the non-controlling interest in 20x1 if the non-controlling interest is to be stated at fair value?
how much is the non-controlling interest on december 31, 20x2 if entity A acquired 90% interest in entity B on January 1, 20x1 when Entity B's net assets had a fair value of 100. on december 31, 20x2 entity B's net assets increased to 200 after adjustments for acquisition date for fair values, net of depreciation
1. How much is the fair value of the net assets of Sub? 2. How much is the goodwill/(gain from bargain purchase) at the date of acquisition? 3. How much is the total assets at the date of acquisition?
19
FE holds investments in a number of subsidiaries and associate entities and made one change to its holdings in 2021, which was the acquisition of LT. The statement of financial position of the FE group as at 31 December 2021 and its comparative are shown below:Statement of financial position as at 31 December 2021 2020ASSETS R000 R000Non-current assetsProperty, plant and equipment 24 000 20 200Goodwill 6 300 5 800Investment in associates 5 200 4 70035 500 30 700Current assets 42 500 31 700Total assets 78 000 62 400EQUITY AND LIABILITIESEquity attributable to owners of the parentShare capital (R1 ordinary shares) 18 000 15 000Share premium 1 000 -Revaluation reserve 2 000 -Retained earnings 12 500 7 60033 500 22 600Non-controlling interests 9 200 8 800Total equity 42 700 31 4006Non-current liabilitiesLong-term borrowings 16 000 18 000Current liabilities 19 300 13 000Total liabilities 35 300 31 000Total equity and liabilities 78 000 62 400Additional information:1. FE acquired 70% of the…
How much is the non controlling interest in the net assets of the subsidiary on december 31,2021
3-Assume that a Parent company owns 100% of its Subsidiary. On January 1, 2020 the Parent company had a $2,000,000 (face) bond payable outstanding with a carrying value of $2,140,000. The bond was originally issued to an unaffiliated company. On that same date, the Subsidiary acquired the bond for $1,992,000. During 2020, the Parent company reported $1,260,000 of (pre-consolidation) income from its own operations (i.e. prior to any equity method adjustments by the Parent company) and after recording interest expense. The Subsidiary reported $840,000 of (pre-consolidation) income from its own operations after recording interest income. Related to the bond during 2020, the parent reported interest expense of $220,000 while the subsidiary reported interest income of $190,000. Required: Determine the following amounts that will appear in the 2020 consolidated income statements. a. Interest income from bond investmentb. Interest expense on bond payablec. Gain (loss) on constructive…