On January 1, 20x1, Red Co. acquired 50,000 out of the 300,000 total outstanding shares of Pepper, Inc. for ₱1,200,000. On December 31, 20x1, Red Co. held bonds issued by Pepper that are convertible into 30,000 ordinary shares. The bonds are convertible anytime. Pepper does not have any other outstanding convertible bonds aside from those held by Red. Pepper reported profit of ₱6,600,000 and declared and paid cash dividends of ₱300,000 for the year. Pepper’s shares are quoted at ₱46 per share on Dec. 31, 20x1. What amount of investment in Pepper shares is reported in Red Co.’s Dec. 31, 20x1 statement of financial position? a. 2,250,000 2,278,332 2,300,000 2,727,120
On January 1, 20x1, Red Co. acquired 50,000 out of the 300,000 total outstanding shares of Pepper, Inc. for ₱1,200,000. On December 31, 20x1, Red Co. held bonds issued by Pepper that are convertible into 30,000 ordinary shares. The bonds are convertible anytime. Pepper does not have any other outstanding convertible bonds aside from those held by Red. Pepper reported profit of ₱6,600,000 and declared and paid cash dividends of ₱300,000 for the year. Pepper’s shares are quoted at ₱46 per share on Dec. 31, 20x1. What amount of investment in Pepper shares is reported in Red Co.’s Dec. 31, 20x1 statement of financial position? a. 2,250,000 2,278,332 2,300,000 2,727,120
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
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- On January 1, 20x1, Red Co. acquired 50,000 out of the 300,000 total outstanding shares of
Pepper, Inc. for ₱1,200,000. On December 31, 20x1, Red Co. held bonds issued by Pepper that are convertible into 30,000 ordinary shares. The bonds are convertible anytime. Pepper does not have any other outstanding convertible bonds aside from those held by Red. Pepper reported profit of ₱6,600,000 and declared and paid cash dividends of ₱300,000 for the year. Pepper’s shares are quoted at ₱46 per share on Dec. 31, 20x1. What amount of investment in
Pepper shares is reported in Red Co.’s Dec. 31, 20x1
- 2,278,332
- 2,300,000
- 2,727,120
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