On January 1, 2020, P Company acquired 80% of S Company for P2,000,000. The fair value of identifiable net assets is P1,800,000. NCI is measured at fair value. During 2020, P Company ships merchandise to S Company costing P800, 000 at 25% above cost. Additional data are as follows: P Company 5,500,000 3,200,000 650,000 S Company 2,500,000 1,600,000 300,000 Sales Cost of Sales Operating Expense The ending inventories of S Company includes merchandise from P Company amounting to P50,000. Impairment of goodwill is P20,000. Consolidated cost of sales is reported at: a P4,800,000 b. P3,800,000 c. P4,010,000 d. P3,810,000

On January 1, 2020, P Company acquired 80% of S Company for P2,000,000. The fair value of identifiable net assets is P1,800,000. NCI is measured at fair value. During 2020, P Company ships merchandise to S Company costing P800, 000 at 25% above cost. Additional data are as follows: P Company 5,500,000 3,200,000 650,000 S Company 2,500,000 1,600,000 300,000 Sales Cost of Sales Operating Expense The ending inventories of S Company includes merchandise from P Company amounting to P50,000. Impairment of goodwill is P20,000. Consolidated cost of sales is reported at: a P4,800,000 b. P3,800,000 c. P4,010,000 d. P3,810,000

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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On January 1, 2022, P Company acquired 80% of S Company forP2,000,000. The fair value of identifiable net assets is P1,800,000. NCI ismeasured at fair value. During 2022, P Company ships merchandise to SCompany costing P1,000, 000 at 20% above cost. Additional data are asfollows:P Company S CompanySales 5,500,000 2,500,000Cost of Sales 3,200,000 1,600,000Operating Expense 650,000 300,000The ending inventories of S Company includes merchandise from PCompany amounting to P60,000. Impairment of goodwill is P20,000.How much is the consolidated gross profit?
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