Problem 17-3 (IFRS)P1,700,000 on January 1, 2020.The shareholders' equity of Film Company on January 1 andDecember 31, 2020 is as follows:January 1 December 313,000,0001,300,0001,500,0003,000,000Share capitalRevaluation surplusRetained earnings1,000,000On January 1, 2020, all the identifiable assets and liabilities ofFilm Company were recorded at fair value.Film Company reported profit of P650,000, after income taxexpense of P350,000 and paid dividends of P150,000 toshareholders during the current year.The revaluation surplus is the result of the revaluation of landrecognized by Film Company on December 31, 2020.Additionally, depreciation is provided by Film Company on thediminishing balance method whereas Czar Company uses thestraight-line.Had Film Company used the straight line, the accumulateddepreciation would be increased by P200,000. The tax rate is30%.Required:1. Prepare journal entries for the current year to recognizethe transactions relating to the investment in associate.2. Determine the carrying amount of the investment inassociate on December 31, 2020.484Mar 24, 2021

Investment-: Investment refers to Investing sum amount or anything to increase its present value in…

Problem 17-3 (IFRS) Czar Company acquired a 40% interest in Film Company for P1,700,000 on January 1, 2020. The shareholders' equity of Film Company on January 1 and December 31, 2020 is as follows: January 1 December 31 3,000,000 3,000,000

Problem 17-3 (IFRS) Czar Company acquired a 40% interest in Film Company for P1,700,000 on January 1, 2020. The shareholders' equity of Film Company on January 1 and December 31, 2020 is as follows: January 1 December 31 3,000,000 3,000,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: #26 The adjusted net income of ABC Company for the years 2021 and 2020 amounted to P 2,796,354.00…

A: Earning per share is a measure of a company profitable ,calculated by dividing quarterly and annual…

Q: On June 30, 2021, ABC Company acquired 50,000 representing 25% ownership interest in Arthur…

A: Investment is the asset or security bought to earn returns from the same in future.

Q: Exercise 5. Various share capital transactions Joshua Company has two classes of share capital…

A: The treasury stock includes the own shares of the company that are repurchased from the…

Q: ary 1, 2020, Levesque Co. purchased 500,000 ordinar at P14 per share, representing a 25% ownership…

A: Introduction: Investment income is described as the amount which a person or institution gains on…

Q: PROBLEM 34 On January1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000.…

A: 1. On 01.01.2020, Edelyn corporation acquired shares of JKL company = 10000 shares Purchase…

Q: 3. Presented below are two independent situations. cbetunos insys aniwollot at SOS 00012561 CL28 to…

A: InvestmentsThe amount of money put into something that gives profits and benefits to the company is…

Q: How much is the cost of investment? * L4 On January 31. 2022. Parent Company purchased al the…

A: The cost of investment is the consideration to be paid by the holding company on the acquisition of…

Q: 27 On January 1, 2019 P Company acquired 70% in S company for $4,200,000; at this date S company…

Q: Freight and delivery charges P80,000 Non-refundable purchase taxes 70,000 Furniture cover*…

A: According to the question, we are required to compute the depreciation expenses using a 1.5…

Q: Auga Company Ltd Comparative Balance Sheet December 31, 2021 and 2020 2021 2020 Increase/(Decrease)…

Q: Problem 1 2018 Jan 1- Nadayag Company purchased 20.000 shares of Cortez Company P100 par at P110 pr…

A: 1) To compute the balance of the investment on December 31, 2020, by journalizing debit to cash and…

Q: Journalize the transactions. 11. Jan, 1 Purchase 40, $1,000 Carlos Company 8% bonds for $40,000.…

A: The cost method is used to record the equity investment when the company acquires less number of…

Q: shj.9

A: The objective of the question is to prepare the journal entry for the sale of securities by Monty…

Q: 00 8 On June 30, 2020, Wisconsin, Inc., issued $288,000 in debt and 17,300 new shares of its $10 par…

A: When an investor pays money for value of shares that exceeds its par worth, additional paid-in…

Q: Problem no. 1 ABC Corporation has the following transactions throughout the year of 2020: Jan ABC…

A: The amount received or fair value of asset (tangible or intagible) above the face value of issued…

Q: On July 1, 2020, ABC Corporation invested in the stocks of XYZ foreign corporation, by acquiring…

A: Capital Gain on Shares: It is possible to realise a capital gain on the appreciation of an asset or…

Q: Myers Company acquired a 60% interest in Gannon Corporation on December 31, 2020 for $1,775,000.…

A: Consolidation I the type of investment in accounting in which the financial statement of the parent…

Q: Brief Exercise 15-11Indigo Inc. owns shares of Sweet Corporation stock. At December 31, 2017, the…

A: Preparation of journal entries to record unrealized holding gain or loss as on September 21, 2018.…

Q: ginning of curr with the follow lative preferenc a value P12, aut areş, P1,000,000

A: To find the amount of ordinary share and preference share as,

Q: Question 4 On January 1, 2018, your company acquires 10,000 shares of Investee Business Limited…

A: A journal entry is the first step—and an essential function—of the accounting process. Journal…

Q: s. The financial statements of Pand S were (see image below). air value and book value of S Companys…

Q: Situation 1 Riverbed Cosmetics acquired 10% of the 215.000 shares of common stock of Martinez…

A: Situation 1 Date Accounts Title and Description Debit ($) Credit…

Q: Suppose that Fattal company acquires exact of Company Pfizer Co. for $1,500,000 at the company…

A: Companies pay dividend to the shareholders according to number of shares holding percentage.

Q: Problem 18-2 (ACP) Endless Company provided the following shareholders' equity on December 31, 2021:…

A: Preference shares: Preference shares allow an investor to own a stake in the issuing firm in…

Q: The following are the condensed balance sheet of GM and SR on January 01, 2018: Total Assets…

A: Acquisition-related costs incurred by the acquirer to effect business combination shall not form…

Q: 5. On January 1, 2021, MNO Company acquired 12,500 of the outstanding common shares of Esther…

A: The question is related Business Combination. The details are as under Stake of MNO Comapny in…

Q: On January 1, 2023, Abbey acquires 90 percent of Benjamin's outstanding shares. Financial…

A: Income tax expenses are the entire amount of taxes owed to a taxation body by an individual,…

Q: ABC began operations in January 2019 and reported the following results for each of its three years…

A: Balance in retained earnings on December 31, 2020 = 2019 loss + 2020 loss + 2021 profit = -P520,000…

Q: The following data is related to Y Corporation. On March 1, 2020: Y acquired 4% of the voting common…

A: The correct answer is c. Dr. Stock investment 20000 and Cr. Cash 20000.Explanation:Type of…

Q: Problem no. 1 ABC Corporation has the following transactions throughout the year of 2020: Jan ABC…

Q: On January 1, 2020, Alison, Inc., paid $73,900 for a 40 percent interest in Holister Corporation's…

A: Equity method of accounting is an accounting process for recording investments in associated…

Q: Parent Corp. owns 40% of Sub Corp. In the current year, Parent has gross income of $43,000 and…

A: Dividend:

Q: how much is the basic earnings per share for the year ended 2021?

A: Basic earnings per share are the earnings which a company has earned during the year on each share…

Q: purchased 20% of the shares of Red Co. for P4,000,000 on July 1, 2020 Pink Co bas a significant…

A: Pink acquied 20% shares of Red Co. for P 4,000,000 on Jul 1 ,2020…

Q: 1. What amount should be recognized as investment income for 2021 as a result of the investment? a.…

A: Investment refers to those mechanism which is used by the company for the purpose of generating…

Q: On January 15, 2020 bieber co purchased 30,000 shares of Hand Co. at $35 per share, paying $10,000…

A: A journal entry means the record the all business transaction of the company during the year for…

Q: Dion, an S shareholder, owned 20% of MeadowBrook's stock for 292 days and 25% for the remaining 73…

A: The following basic information as follows under:Dion, an S shareholder, owned 20% of Meadow Brook's…

Q: On April 30, 2021, Marie Company purchased for cash 18,000 of the 60,000 voting shares of Robbie…

A: Calculation of goodwill on the date of acquisition: Annual amortization of equipment = 30,000 / 5…

Q: Qutacember 5, 2020, POY company purchased 15,000 shares of SM. SM has 10,000.000 OUTstanding shares.…

A: As per protocol we provide solution to the one question only and as you have asked multiple…

Q: Question 1 Part A Success Ltd. had the following equity balances as at July 1, 2020: Equity Share…

A: Stockholder's Equity - Stockholder's Equity includes the amount contributed by shareholders issued…

Q: 1 Prepare a determination and distribution of excess schedule for the investment. 2 Prepare all the…

A: Paul Co. has acquired 90% interest in Shaq Company, hence Paul co. has become the holding co. of…

Q: QUESTION 4 On 1 January 2018, Chelsea Ltd acquired 75% of the shares in Orlando Ltd at N$126 000. At…

A: Solution- WN-1 Calculation of net identifiable assets Particulars As on Date of Acquisition…

Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

Problem 17-3 (IFRS)
P1,700,000 on January 1, 2020.
The shareholders' equity of Film Company on January 1 and
December 31, 2020 is as follows:
January 1 December 31
3,000,000
1,300,000
1,500,000
3,000,000
Share capital
Revaluation surplus
Retained earnings
1,000,000
On January 1, 2020, all the identifiable assets and liabilities of
Film Company were recorded at fair value.
Film Company reported profit of P650,000, after income tax
expense of P350,000 and paid dividends of P150,000 to
shareholders during the current year.
The revaluation surplus is the result of the revaluation of land
recognized by Film Company on December 31, 2020.
Additionally, depreciation is provided by Film Company on the
diminishing balance method whereas Czar Company uses the
straight-line.
Had Film Company used the straight line, the accumulated
depreciation would be increased by P200,000. The tax rate is
30%.
Required:
1. Prepare journal entries for the current year to recognize
the transactions relating to the investment in associate.
2. Determine the carrying amount of the investment in
associate on December 31, 2020.
484
Mar 24, 2021

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

FE holds investments in a number of subsidiaries and associate entities and made one change to its holdings in 2021, which was the acquisition of LT. The statement of financial position of the FE group as at 31 December 2021 and its comparative are shown below: 2020 Statement of financial position as at 31 December 2021 ASSETS Non-current assets Property, plant and equipment Goodwill Investment in associates R000 R000 24 000 6 300 5 200 35 500 42 500 78 000 20 200 5 800 4 700 30 700 31 700 62 400 Current assets Total assets EQUITY AND LIABILITIES Equity attributable to owners of the parent Share capital (R1 ordinary shares) Share premium Revaluation reserve Retained earnings 15 000 18 000 1 000 2 000 12 500 33 500 9 200 7 600 22 600 Non-controlling interests Total equity 8 800 31 400 42 700
stion 51 At December 31, 2020, BFAR Corp. had 20,000 treasury shares that had been re-acquired in 2020 at 14 per share. These shares have a par value of P8 per share. In May 2021, the company re-issued 6,000 of these treasury shares at P10 per share. On December 31, 2021, how much should be the amount of appropriation of accumulated profits from the above transactions, under the cost method?
answer pls ty
Q13 Mamagau Limited acquired 50% of the voting shares of Mashego Limited at 30 April 2015 at R160 000. The balance sheet of Mashego Limited showed the following balances at 30 April 2015: Non-current assets R450 000 Current assets R120 000 Non-current liabilities R240 000 Current liabilities R25 000 The year-end date for Mamagau Limited is on 30 April of every year. During the year ended 30 April 2016 Mashego Limited reported an after tax profit of R120 000. The directors of Mashego Limited declared an ordinary dividend of R20 000 but not yet paid at reporting date. Mamagau Limited applies equity accounting method for its associates and joint ventures. What is the correct journal to record the dividend declared as at 30 April 2016in the books of Mamagau Limited? Select one: a. Dr Investment in Mashego Limited R20 000 Cr Bank R20…
Review 17-9 Parent Corp. owns 40% of Sub Corp. In the current year, Parent has gross income of $43,000 and allowable deductions of $30,000 before considering any dividends received deduction (DRD). Included in the $43,000 gross income is $8,000 of dividends from Sub. What is the maximum DRD available to Parent? a. $4,000 b. $5,200 c. $8,000 d. $8,450
t.no.16
QUESTION Numba Ephraim plc, a retailing company has an authorized share capital of 700,000 ordinary shares of K1 each. The following trial balance was extracted from the books of account as at 31 December 2020. Dr Cr K000 K000 Issued share capital 560 Share premium account 140 Income Statement…
question 75
LL %24 The separate condensed balance sheets of Patrick Corporation and its wholly-owned subsidiary, Sean Corporation, are as BALANCE SHEETS December 31, 2020 Patrick Sean Cash Accounts receivable (net) Inventories Plant and equipment (net) Investment in Sean 24 000'9 000 9 000 00000 000 0 000 $1,400,000 $ 418,000 Total assets 82,000 Accounts payable Long-term debt Common stock ($10 par) Additional paid-in capital Retained earnings 000'8 000 306,000 262,000 000't78 Total liabilities and shareholders' 000 Additional Information: • On December 31, 2020, Patrick acquired 100 percent of Sean's voting stock in exchange for $454,000. • At the acquisition date, the fair values of Sean's assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Sean's inventory were $20,000 more than their carrying amounts. In the December 31, 2020, consolidated balance sheet of Patrick and its subsidiary, what amount of total assets should be reported?…
q1
Norway Company investments to Latvia Company are: Preference share capital 15% Ordinary share capital 40% Latvia Company's share capital outstanding on December 31 2021. is as follows: 10% Cumulative preference share capital P2,000.000 Ordinary share capital 7.000.000 Latvia Company reported a net income of P5.000.000 for the year ended Doccember 31. 2021. How much is the investment income for December 31. 2021?
6. Avon Company acquired 40.000 ordinary shares of Nolon Company OCiober Financial Accounting ! Chapter 9 Page 24 2020 for P6,600,000. On Decernber30.2020. Nolan distributed o10%ana stock dividend when the market price of the share w as P250 On Decenbare 2020, Avon sokd 4,000 shares of its Nolan Oonfipany forPi C00,000. For ffie year Ehded December 31.2020. how muct should Avon.report as gain on sale of investment? 0. 340.000 400,000 40,000 C. 500.000 d. 600,000