On January 1, 20x8,Parent Company purchased 80% of the outstanding shares of Subsidiary Company for P800,000. On the date of acquisition, Subsidiary Company reported Ordinary Shares of P800,000 and Retained Earnings of P200,000. Subsidiary's Inventory was understated by P20,000; Equipment with a 5-year life was understated by P20,000, Building with an 8-year life was understated by P80,000 and land was understated by P40,000. The non-controlling interest is to be stated at fair value and the fair value of the non-controlling interest on January 1, 20x8 is P210,000. The following are taken from the books of Parent and Subsidiary for 20x8. * Subsidiary
On January 1, 20x8,Parent Company purchased 80% of the outstanding shares of Subsidiary Company for P800,000. On the date of acquisition, Subsidiary Company reported Ordinary Shares of P800,000 and Retained Earnings of P200,000. Subsidiary's Inventory was understated by P20,000; Equipment with a 5-year life was understated by P20,000, Building with an 8-year life was understated by P80,000 and land was understated by P40,000. The non-controlling interest is to be stated at fair value and the fair value of the non-controlling interest on January 1, 20x8 is P210,000. The following are taken from the books of Parent and Subsidiary for 20x8. * Subsidiary
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:On January 1, 20x8,Parent Company purchased 80% of the outstanding
shares of Subsidiary Company for P800,000. On the date of acquisition,
Subsidiary Company reported Ordinary Shares of P800,000 and
Retained Earnings of P200,000. Subsidiary's Inventory was understated
by P20,000; Equipment with a 5-year life was understated by P20,000,
Building with an 8-year life was understated by P80,000 and land was
understated by P40,000. The non-controlling interest is to be stated at
fair value and the fair value of the non-controlling interest on January 1,
20x8 is P210,000. The following are taken from the books of Parent and
Subsidiary for 20x8. *
Parent
Subsidiary
2,000,000 1, 500,000
350,000
150, 000
50,000
Sales
550,000
200,000
100,000
Gross Profit
Net Income
Dividend Declared (to be paid on Jan
15, 20x9)
Total Assets
5,000,000 4,000,000
Determine the Total Assets as of December 31, 20x8.
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