On January 1, 2021, PCO purchased 70% ownership of SCO which resulted to a gain on acquisition of P100,000. Net assets of SCO were fairly valued except for inventory which was understated by P1,500,000. A third of these inventories remained unsold as of the end of the calendar year. The operations of the two companies for 2021 are as follows: In the consolidated statement of comprehensive income for the year ended December 31, 2021, how much is the cost of goods sold? a. 1,550,000 b. 1,850,000 c. 3,550,000 d. 3,250,000
On January 1, 2021, PCO purchased 70% ownership of SCO which resulted to a gain on acquisition of P100,000. Net assets of SCO were fairly valued except for inventory which was understated by P1,500,000. A third of these inventories remained unsold as of the end of the calendar year. The operations of the two companies for 2021 are as follows: In the consolidated statement of comprehensive income for the year ended December 31, 2021, how much is the cost of goods sold? a. 1,550,000 b. 1,850,000 c. 3,550,000 d. 3,250,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
On January 1, 2021, PCO purchased 70% ownership of SCO which resulted to a gain on acquisition of P100,000. Net assets of SCO were fairly valued except for inventory which was understated by P1,500,000. A third of these inventories remained unsold as of the end of the calendar year.
The operations of the two companies for 2021 are as follows:
In the consolidated statement of comprehensive income for the year ended December 31, 2021, how much is the cost of goods sold?
a. 1,550,000
b. 1,850,000
c. 3,550,000
d. 3,250,000
Transcribed Image Text:On January 1, 2021, PCO purchased 70% ownership of SCO which resulted to a gain
on acquisition of P100,000. Net assets of SCO were fairly valued except for inventory
which was understated by P1,500,000. A third of these inventories remained unsold as
of the end of the calendar year.
The operations of the two companies for 2021 are as follows:
PCO
SCO
Sales
P3,100,000
P2,600,000
Quiz: Quiz 2
(COGS)
(1,300,000)
(1,250,000)
Gross profit
1,800,000
1,350,000
(OPEX)
(200,000)
(150,000)
Other income
200,000
(Other expenses)
(120,000)
Net income
P1,480,000
P 400,000
In the consolidated statement of comprehensive income for the year ended December
31, 2021, how much is the cost of goods sold?
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