On the 1/01/x3, J Group acquired 2 025 000 of the 4 500 000 ordinary R1 shares in Entity PA for R5 695000. At acquisition, PA had retained earnings of R1 400 000. When preparing the J Group's consolidatedfinancial statements for the year end date of 31/12/x3, accountants at the group entity are working with thefollowing information: In the x3 financial year, Entity PA made a profit after tax of R 1 230 000; In the x3financial year, PA paid a dividend totaling R45 000 to its shareholders; At the end of the x3 financial year,the group's investment in PA is found to have impaired by R94 000. Based on this information, calculatethe group's investment in associate figure, in its consolidated financial statements dated 31/12/x3.

The objective of the question is to calculate the group's investment in associate figure in its…

Answered: On the 1/01/x3, J Group acquired 2 025…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On the 1/01/x3, J Group acquired 2 025 000 of the 4 500 000 ordinary R1 shares in Entity PA for R5 695 000. At acquisition, PA had retained earnings of R1 400 000. When preparing the J Group's consolidated financial statements for the year end date of 31/12/x3, accountants at the group entity are working with the following information: In the x3 financial year, Entity PA made a profit after tax of R 1 230 000; In the x3 financial year, PA paid a dividend totaling R45 000 to its shareholders; At the end of the x3 financial year, the group's investment in PA is found to have impaired by R94 000. Based on this information, calculate the group's investment in associate figure, in its consolidated financial statements dated 31/12/x3.
Jam Ltd acquired all the equity in Cab Ltd on 31 December 20X4 for $360 000. At the control date, the equity of Cab was recorded as Paid-up capital of $260 000 and Retained profits of $30 000. The purchase price was based on the agreed fair values of Cab's identifiable assets and liabilities on that date. The following items were not at fair value in Cab's financial statements on the control date. Inventory Property (Cost of $250 000, Accumulated depreciation of $40 000) Carrying amount ($) 32 000 210 000 Fair value ($) 24 000 252 000 Other information: • Both Cab and the group entity account for its property by the cost model, and apply straight-line depreciation to the property. The property in Cab Ltd is expected to have a remaining life of 21 years from 31 December 20X4, and no residual value. Cab sold goods to Jam for $5,000 during FY20X5, the cost of these inventories was 4,000. All these inventories were still on hand by Jam by 31 December 20X5, the year-end. . Required: Prepare…
On January 1 Criquet Co. acquired an interest in the Tamlee Co. for $500,000. At December 31, Tamlee Co. declared and paid a cash dividend of $50,000 and reported a net income of $160,000. REQUIRED: Prepare the journal entries for the Criquet Co. under each of the independent circumstances: 1. Criquet Co. acquires a 10% interest in the Tamlee Co. 2. Criquet Co. acquires a 25% interest in the Tamlee Co.
a) Calculate the S corporation's ordinary (non-separately stated) income and indicate which items must be separately stated b) If at the beginning of the year, Archer had a basis of 20,000 compute Archer’s basis at the end of the year. c) Assume that Voyager reported a loss of $70,000 instead (and no separately stated items or distributions). If Janeway had a basis of 10,000 in her stock at the beginning of the year, what is the amount of loss she can report on her return?
Swifty Company reported net income of $481000 for the year ended 12/31/25. Included in the computation of net income were the following: depreciation expense, $59400; amortization of a patent, $32000; income from an investment in the common stock of Blue Inc., accounted for under the equity method, $ 48400; and amortization of bond discount, $12000. Swifty also paid an $81000 dividend during the year. The net cash provided by operating activities would be reported at (a) $455000 (b) 423000 (c)342000 (d ) 536000
ABC paid finder's fees of P80,000, legal fees of P26,000, audit fees related to stock issuance of P20,000, stock registration fees of P10,000 and stock listing application fees of P8,000. Based on the given information, under the acquisition method, what amount relating to business combination would be charged to expense?
kayend Corporation purchases 85% of Subil Products' common stock. Assume that Kayend already recorded the acquisition on January 1, 20X1. During the year, Kayend reports operating earnings of $450,000, excluding its income from investing in Subil, and declares dividends of $70,000. Subil reports 20X1 net income of $50,000 and declares dividends of $30,000. Which of the following is Kayend's journal entry to record its share of Subil's income? Debit Noncontrolling Interest for $42,500; Credit Cash for $42,500 Debit Investment in Subil Products for $42,500; Credit Cash for $42,500 Debit Cash for $42,500; Credit Noncontrolling Interest for $42,500 Debit Investment in Subil Products for $42,500; Credit Income from Subil Products for $42,500
Required information (The following information applies to the questions displayed below.) Marathon Inc. (a Ccorporation) reported $1700,000 of taxable income in the current year. During the year, distributed $170,000 as dividends to Its shareholders as follows: • $8,500 to Guy, a 5 percent individual shareholder. $25,500 to Little Rock Corp., a 15 percent shareholder (C corporation). • $136,000 to other shareholders. d. Complete Form 1120 Schedule C for Little Rock Corp. to reflect its dividends received deduction (use the most recent Form 1120 Schedule
On January 1, 20x1, ABC Corporationpurchased all of XYZ Corporation's commonstock for $1,200,000. On that date, the fairvalues of XYZ's assets and liabilities equaledtheir carrying amounts of $1,320,000 and$320,000, respectively. During year 1, XYZpaid cash dividends of $20,000. Selectedinformation from the separate balancesheets and income statements of ABC andXYZ as of December 31, year 1, and for theyear then ended follows: ABC Corporation(Column 1), XYZ Corporation (Column 2)
Merit is a Company that operates in the Retail business and has a 30 June 2021 year end. The Books of Merit private limited are as follows:Statement of Profit or loss and other comprehensive income as at 30 June 2021RSales1 500 000Cost of Sales(750 000)Gross Profit750 000Office expenses (Including interest on debentures)(125 000)Selling expenses(125 000)Profit before Tax500 000Tax(250 000)Net Profit250 000Statement of Financial Position as at 30 June 2021RAssetsFixed Assets5 500 000Inventory175 000Trade Receivables350 000Bills Receivables50 000Cash225 000Intangible Assets100 000Total Assets6 400 000Equity and LiabilitiesShare Capital2 000 00010% Preference shares2 000 000Retained Earnings1 100 00010% Debentures1 000 000Trade Payables100 000Bank Overdraft150 0006Bills Payables45 000Outstanding Expenses5 000Total Equity and Liabilities6 400 000 Additional Information1. Opening Inventory was R 325 0002. A year has 360 days RequiredCalculate the following ratios, Answer ALL questions.…
Subject: accounting
Western Corporation, a calendar year, accrual basis corporation, reported $500,000 of net income after tax on its financial statements prepared in accordance with GAAP. The corporation’s books and records reveal the following information: Western’s book income included $15,000 of dividends, received from a domestic corporation in which Western owns less than 1 percent of the outstanding stock. Western’s depreciation expense per books was $55,000, and its MACRS depreciation was $70,000. Western earned $5,000 of interest from municipal bonds and $6,000 of interest from corporate bonds. Western’s capital losses exceeded its capital gains by $2,000. Western’s federal income tax expense per books was $103,000. Required: Compute Western’s federal taxable income and regular tax liability. Prepare a Schedule M-1, page 6, Form 1120, reconciling Western’s book and taxable income.

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