On January 1, Parent Company acquired 90% of Subsidiary Company in exchange for 5,400 shares of P10 par common stock having a market value of P120,600. Parent and Subsidiary condensed balance sheet on January 1, were as follows: Parent Company Assets Subsidiary Company 37,400 9,100 16,100 40,000 10,000 112,600 Cash P 30,900 34,200 22,900 179,000 P Accounts receivable, net Inventories Equipment, net Patents Total Assets 267,000 P. Liabilities and Equities Accounts Payable Bonds Payable Common stock, P10 par P 4,000 100,000 100,000 15,000 48,000 267,000 P 6,600 50,000 15,000 41,000 112,600 Share Premium Retained earnings Total Liabilities and Equities P At the date of acquisition, all assets and liabilities of Subsidiary Company have book valu approximately equal to their respective market values except the following as determine by appraisal as follows: Inventories (FIFO method) Equipment (net-remaining life 4 years) Patents (remaining life 10 years) 17,100 48,000 13,000 P ADDITIONAL INFORMATION: For the year ended December 31, the following results were given: Dividend Paid Net Income Parent Company Subsidiary Company P 15,000 4,000 30,200 9,400

On January 1, Parent Company acquired 90% of Subsidiary Company in exchange for 5,400 shares of P10 par common stock having a market value of P120,600. Parent and Subsidiary condensed balance sheet on January 1, were as follows: Parent Company Assets Subsidiary Company 37,400 9,100 16,100 40,000 10,000 112,600 Cash P 30,900 34,200 22,900 179,000 P Accounts receivable, net Inventories Equipment, net Patents Total Assets 267,000 P. Liabilities and Equities Accounts Payable Bonds Payable Common stock, P10 par P 4,000 100,000 100,000 15,000 48,000 267,000 P 6,600 50,000 15,000 41,000 112,600 Share Premium Retained earnings Total Liabilities and Equities P At the date of acquisition, all assets and liabilities of Subsidiary Company have book valu approximately equal to their respective market values except the following as determine by appraisal as follows: Inventories (FIFO method) Equipment (net-remaining life 4 years) Patents (remaining life 10 years) 17,100 48,000 13,000 P ADDITIONAL INFORMATION: For the year ended December 31, the following results were given: Dividend Paid Net Income Parent Company Subsidiary Company P 15,000 4,000 30,200 9,400

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

The ratio percentage of earnings retained is the same as that termed : A- dividend yield B- dividend payout C- this year's retained earning to net income D- return on common equity
2 Tiger Audio declared and paid a cash dividend of $7,925 in the current year. Its comparative financial statements, prepared at December 31, reported the following summarized information: Current Previous Income Statement $342,000 $281,000 175,650 166,350 63,600 6,400 96,350 28,905 Sales Revenue Cost of Goods Sold 159,000 122,000 52,930 5,670 63,400 19,020 Gross Profit Operating Expenses Interest Expense Income before Income Tax Expense Income Tax Expense (30%) Net Income $ 67,445 $ 44,380 Balance Sheet $ 72,520 32,900 49,000 151,000 $305,420 $ 45, 200 28,000 46,000 138, 200 Cash Accounts Receivable, Net Inventory Property and Equipment, Net Total Assets $257,400 $ 39,000 4,800 101,900 145,700 39,400 120,320 $ 37,000 4,000 116, 200 157, 200 39,400 60,800 Accounts Payable Income Tax Payable Note Payable (long-term) Total Liabilities Common Stock (par $1) Retained Earnings Total Liabilities and Stockholders' Equity $305,420 $257,400
Times interest earned is a measure of the a. gross profit compared to annual interest payments b. operational earnings of the firm (EBIT) compared to annual interest payments c. net earnings after taxes compared annual interest payments d. net earnings before taxes compared to annual interest payments
Assuming the current ratio equals 2, which of the following would cause the current ratio to increase? O Accrual for payroll. Declaration of cash dividend. O Payment for inventory purchased on account. O Inventory purchased on account.
How would I calculate total dividend value?
explain how you got the calulation of dividend
Pasta Corporation acquired 75% of Sauce Company on January 1, 2020 for $566,250 cash. The fair value of the other 25% ownership interest is estimated to be $188,750. ADDITIONAL INFORMATION: On the date of acquisition: * The Book Value of Sauce Company's net identifiable assets was $652,000. * Sauce's Company's Plant Assets were undervalued by $75,000 (remaining life was estimated to be 5 years). * Sauce's Company's Inventories were overvalued by $9,000 (all sold by year end). * New Goodwill was determined to be $37,000. At year-end, it was determined that the New Goodwill was impaired by $5,800. * For 2020, Sauce reported net income of $146,500 and paid dividends of $26,000. Assume that Pasta Company uses the fully adjusted equity method to account for its Investment in Sauce.
How much is capital at the start of the year?
What is this classified as on the income statement? Change in accounts payable Revenue Expense Depreciation Other Farm income
Which statement shows dividends paid?
Identify the different types of dividends. How much is debited to Retained Earnings upon declaration of each types of dividends?
Financial Accounting ‏