On January 1, 20x2, Gold Company purchased a computer with an expected economic life of five years. On January 1, 20x4, Gold sold the computer to TLK Corporation and recorded the following entry: Cash 39,000 Accumulated Depreciation 16,000 Computer Equipment 40,000 Gain on sale of equipment 15,000 TLK Corporation holds 60 percent of Gold's voting shares. Gold reported net income of P45,000, and TLK reported income from its own operations of P85,000 for 20x4. There is no change in the estimated life of the equipment as a result of the inter-corporate transfer.
On January 1, 20x2, Gold Company purchased a computer with an expected economic life of five years. On January 1, 20x4, Gold sold the computer to TLK Corporation and recorded the following entry: Cash 39,000 Accumulated Depreciation 16,000 Computer Equipment 40,000 Gain on sale of equipment 15,000 TLK Corporation holds 60 percent of Gold's voting shares. Gold reported net income of P45,000, and TLK reported income from its own operations of P85,000 for 20x4. There is no change in the estimated life of the equipment as a result of the inter-corporate transfer.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The income assigned to the non-controlling interest in the 20x4 consolidated income statement will be:
A. 12,000 C. 18,000
B. 14,000 D. 52,000
The consolidated net income for 20x4 will be:
A. 106,000 C. 120,000
B.112,000 D. 130,000
Transcribed Image Text:On January 1, 20x2, Gold Company purchased a computer with an expected
economic life of five years. On January 1, 20x4, Gold sold the computer to TLK
Corporation and recorded the following entry:
Cash 39,000
Accumulated Depreciation 16,000
Computer Equipment 40,000
Gain on sale of equipment 15,000
TLK Corporation holds 60 percent of Gold's voting shares. Gold reported net
income of P45,000, and TLK reported income from its own operations of
P85,000 for 20x4. There is no change in the estimated life of the equipment as
a result of the inter-corporate transfer.
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