On 20 December 20x1, a 60%-owned Subsidiary paid rental of $200,000 to its Parent. The Parent recognised the rental as income whilst the Subsidiary recognised the rental paid as an expense. The space area rented by the Subsidiary from the Parent comprises 98% of the building for which the Parent occupies the remaining 2% thereof. In the separate financial statements of the Parent, the carrying amount of the building was $5,000,000 as at 31 December 20x1. Given that both parent and subsidy adopt 31 December as their financial year-end, prepare the (i) journal entries of parent and subsidy, and (ii) the consolidated journal entries
On 20 December 20x1, a 60%-owned Subsidiary paid rental of $200,000 to its Parent. The Parent recognised the rental as income whilst the Subsidiary recognised the rental paid as an expense. The space area rented by the Subsidiary from the Parent comprises 98% of the building for which the Parent occupies the remaining 2% thereof. In the separate financial statements of the Parent, the carrying amount of the building was $5,000,000 as at 31 December 20x1. Given that both parent and subsidy adopt 31 December as their financial year-end, prepare the (i) journal entries of parent and subsidy, and (ii) the consolidated journal entries
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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On 20 December 20x1, a 60%-owned Subsidiary paid rental of $200,000 to its Parent. The Parent recognised the rental as income whilst the Subsidiary recognised the rental paid as an expense. The space area rented by the Subsidiary from the Parent comprises 98% of the building for which the Parent occupies the remaining 2% thereof. In the separate financial statements of the Parent, the carrying amount of the building was $5,000,000 as at 31 December 20x1.
Given that both parent and subsidy adopt 31 December as their financial year-end, prepare the (i)
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