On January 3, 2021, ABC acquired 60% of the outstanding shares of JKL an excess of cost over book value of P3,000,000. This excess was allocated to property, plant and equipment with 10 years of estimated useful life which half was already use. For the year ended December 31, 2022, JKL prepared the following condensed financial statements: Statement of Financial Position Current Assets P2,250,000 Liabilities P1,000,000 8,500,000 Property, Plant and 12,500,000 Share Capital Equipment, net Accumulated Profits 5,250,000 Total P14,750,000 Total P14,750,000 Statement of Accumulated Profits Accumulate Profits, Beg P5,000,000 P2,500,000 (1,250,000) (750,000) P500,000 Sales Cost of Goods Sold Operating Expenses Net Income (250,000) P5,250,000 Dividends Accumulated Profits, End JKL regularly sells merchandise to ABC at a price of 120% of cost. In 2021 and 2022, sales from JKL to ABC are as follows: Sales-2021 for P2,100,000 (inventory sold by ABC 1,800,000) ; Sales -2022 P1,200,000 (inventory unsold by ABC P750,000). On December 31, 2022 compute for the non-controlling interest in Net assets. Compute for the Profit attributable to Equity Holders of Parent or Controlling Interest in Net Income.
On January 3, 2021, ABC acquired 60% of the outstanding shares of JKL an excess of cost over book value of P3,000,000. This excess was allocated to property, plant and equipment with 10 years of estimated useful life which half was already use. For the year ended December 31, 2022, JKL prepared the following condensed financial statements: Statement of Financial Position Current Assets P2,250,000 Liabilities P1,000,000 8,500,000 Property, Plant and 12,500,000 Share Capital Equipment, net Accumulated Profits 5,250,000 Total P14,750,000 Total P14,750,000 Statement of Accumulated Profits Accumulate Profits, Beg P5,000,000 P2,500,000 (1,250,000) (750,000) P500,000 Sales Cost of Goods Sold Operating Expenses Net Income (250,000) P5,250,000 Dividends Accumulated Profits, End JKL regularly sells merchandise to ABC at a price of 120% of cost. In 2021 and 2022, sales from JKL to ABC are as follows: Sales-2021 for P2,100,000 (inventory sold by ABC 1,800,000) ; Sales -2022 P1,200,000 (inventory unsold by ABC P750,000). On December 31, 2022 compute for the non-controlling interest in Net assets. Compute for the Profit attributable to Equity Holders of Parent or Controlling Interest in Net Income.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Topic: Intercompany Sale of Inventory
Transcribed Image Text:On January 3, 2021, ABC acquired 60% of the outstanding shares of JKL an excess of cost over book
value of P3,000,000. This excess was allocated to property, plant and equipment with 10 years of
estimated useful life which half was already use. For the year ended December 31, 2022, JKL prepared
the following condensed financial statements:
Statement of Financial Position
Current Assets
Plant
P2,250,000 Liabilities
P1,000,000
8,500,000
Property,
and
12,500,000 Share Capital
Equipment, net
Accumulated Profits
P14,750,000 Total
5,250,000
P14,750,000
Total
Statement of Accumulated Profits
Accumulate Profits, Beg
P5,000,000
P2,500,000
(1,250,000)
(750,000)
P500,000
Sales
Cost of Goods Sold
Operating Expenses
Net Income
Dividends
(250,000)
P5,250,000
Accumulated Profits, End
JKL regularly sells merchandise to ABC at a price of 120% of cost. In 2021 and 2022, sales from JKL to
ABC are as follows: Sales-2021 for P2,100,000 (inventory sold by ABC 1,800,000) ; Sales -2022
P1,200,000 (inventory unsold by ABC P750,000). On December 31, 2022 compute for the non-controlling
interest in Net assets. Compute for the Profit attributable to Equity Holders of Parent or Controlling
Interest in Net Income.
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