On January 2, 2021, the Statement of Financial Position of Parent and Subsidiary Company prior to the combination are: Parent Co. Subsidiary Co. Cash P 450,000 P 15,000 Inventories 300,000 30,000 Property and equipment (net) 750,000 105,000 Total Assets P1,500,000 P 150,000
On January 2, 2021, the Statement of Financial Position of Parent and Subsidiary Company prior to the combination are: Parent Co. Subsidiary Co. Cash P 450,000 P 15,000 Inventories 300,000 30,000 Property and equipment (net) 750,000 105,000 Total Assets P1,500,000 P 150,000
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 25E
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![On January 2, 2021, the Statement of Financial Position of Parent and Subsidiary Company prior to the combination are:
Parent Co.
Subsidiary Co.
Cash
P 450,000
P 15,000
Inventories
300,000
30,000
Property and equipment (net)
750,000
105,000
Total Assets
P 1,500,000
P 150,000
Current Liabilities
P 90,000
P 15,000
Common Stock, P100 par
150,000
15,000
Additional Paid in Capital
450,000
30,000
Retained Earnings
810,000
90,000
Total Liabilities and Stockholders' Equity
P 1,500,000
P 150,000
The fair value of Subsidiary Company's equipment is P153,000.
Assuming Parent Company acquired 80% of the outstanding common stock of Subsidiary Company for P136,800 and NCI is measured at its proportionate share of
subsidiary's net assets, how much is the consolidated stockholder's equity on the date of acquisition?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4ece0784-63e3-4ad2-ba52-cab1c99c9a84%2Fe68312ea-2df9-4a9d-b191-92bf1aa8449b%2F7mek4e4_processed.jpeg&w=3840&q=75)
Transcribed Image Text:On January 2, 2021, the Statement of Financial Position of Parent and Subsidiary Company prior to the combination are:
Parent Co.
Subsidiary Co.
Cash
P 450,000
P 15,000
Inventories
300,000
30,000
Property and equipment (net)
750,000
105,000
Total Assets
P 1,500,000
P 150,000
Current Liabilities
P 90,000
P 15,000
Common Stock, P100 par
150,000
15,000
Additional Paid in Capital
450,000
30,000
Retained Earnings
810,000
90,000
Total Liabilities and Stockholders' Equity
P 1,500,000
P 150,000
The fair value of Subsidiary Company's equipment is P153,000.
Assuming Parent Company acquired 80% of the outstanding common stock of Subsidiary Company for P136,800 and NCI is measured at its proportionate share of
subsidiary's net assets, how much is the consolidated stockholder's equity on the date of acquisition?
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