PC has P50,000 and P80,000 comprehensive income from its operations on 20X1 and 20X2, respectively. On the other hand, SC has P20,000 and P50,000 comprehensive income from its operations for 20X1 and 20X2.
PC has P50,000 and P80,000 comprehensive income from its operations on 20X1 and 20X2, respectively. On the other hand, SC has P20,000 and P50,000 comprehensive income from its operations for 20X1 and 20X2.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:2. On January 2, 20X1, Padre Corporation (PC) purchases 80% of the common stock of Son Company (SC)
for P300,000. SC's has P200,000 and P50,000 book value of common stock and retained earnings. The
book values of SC identifiable net assets approximate their related fair values. On May 20X1, PC sold
merchandise costing P19,600 to SC for P24,500. Out of which, only P5,000 remains unsold by SC at the
end of 20X1. PC and Saul use the same mark-up based on cost.
In 20X2, PC sold another merchandise to SC for P30,000. Of the said merchandise, P8,000 remains in the
ending inventory of 20X2.
PC has P50,000 and P80,000 comprehensive income from its operations on 20X1 and 20X2, respectively.
On the other hand, SC has P20,000 and P50,000 comprehensive income from its operations for 20X1 and
20X2.
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