On January 1, 2021, Herwin Company acquired 40%of GIC Company by purchasing 8,000 shares for P1,440,000. On the date of acquisition, Herwin calculated that its share of the excess of the fair value over the book value of GIC's depreciab assets was P150,000 and that the purchased goodwill was P120,000. At the end of 2021, GIC reported profit of P450,000 and paid dividends of P7.00 per share. Herwin depreciates its depreciable assets over 12-year remaining life. What is the amount of income Herwin Company would report from its investment in GIC for the year ended December 2021? (A) P105,500

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On January 1, 2021, Herwin Company acquired 40%of GIC Company by purchasing 8,000 shares for P1,440,000. On the
date of acquisition, Herwin calculated that its share of the excess of the fair value over the book value of GIC's depreciable
assets was P150,000 and that the purchased goodwill was P120,000. At the end of 2021, GIC reported profit of P450,000
and paid dividends of P7.00 per share. Herwin depreciates its depreciable assets over 12-year remaining life.
What is the amount of income Herwin Company would report from its investment in GIC for the year ended December 31,
2021?
A P105,500
в) Р56,000
P167,500
D P172,600
Transcribed Image Text:On January 1, 2021, Herwin Company acquired 40%of GIC Company by purchasing 8,000 shares for P1,440,000. On the date of acquisition, Herwin calculated that its share of the excess of the fair value over the book value of GIC's depreciable assets was P150,000 and that the purchased goodwill was P120,000. At the end of 2021, GIC reported profit of P450,000 and paid dividends of P7.00 per share. Herwin depreciates its depreciable assets over 12-year remaining life. What is the amount of income Herwin Company would report from its investment in GIC for the year ended December 31, 2021? A P105,500 в) Р56,000 P167,500 D P172,600
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