Pentagon Company acquires 80% of Square Company for P500,000 on January 1, 2012. On that date, Square’s common stock and retained earnings amounted to P200,000. Inventory was overvalued by P10,000, equipment (10-year remaining life) was undervalued by P30,000 and buildings (10-year remaining life) were undervalued by P40,000. Any excess consideration is attributable to goodwill. From 2012 to 2014, Square earns income and pay dividends as follows: 2012 2013 2014 Net income P100,000 P120,000 P130,000 Dividends 40,000 50,000 60,000 What amount is the non-controlling interest in net income of Square for the year ended December 31, 2012? A. P12,600 B. P20,000 C. P16,600 D. P20,600
Pentagon Company acquires 80% of Square Company for P500,000 on January 1, 2012. On that date, Square’s common stock and retained earnings amounted to P200,000. Inventory was overvalued by P10,000, equipment (10-year remaining life) was undervalued by P30,000 and buildings (10-year remaining life) were undervalued by P40,000. Any excess consideration is attributable to goodwill. From 2012 to 2014, Square earns income and pay dividends as follows: 2012 2013 2014 Net income P100,000 P120,000 P130,000 Dividends 40,000 50,000 60,000 What amount is the non-controlling interest in net income of Square for the year ended December 31, 2012? A. P12,600 B. P20,000 C. P16,600 D. P20,600
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Pentagon Company acquires 80% of Square Company for P500,000 on January 1, 2012. On that date, Square’s common stock and
|
|
2012 |
2013 |
2014 |
|
Net income |
P100,000 |
P120,000 |
P130,000 |
|
Dividends |
40,000 |
50,000 |
60,000 |
What amount is the non-controlling interest in net income of Square for the year ended December 31, 2012?
A. P12,600
B. P20,000
C. P16,600
D. P20,600
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