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PROBLEM 34 On January 1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000. The 10,000 shares are equivalent to 20% interest of the investee. JKL Company reported the following net income or loss: 2020 - P1,000,000 2021 - (P5,000,000) 2022 - P300,000 Requirements: 1. Prepare the necessary journal entries to record the share of income or loss in 2020, 2021, and 2022. 2. What is the carrying value of the investment on December 31, 2020? December 31, 2021? December 31, 2022

PROBLEM 34 On January 1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000. The 10,000 shares are equivalent to 20% interest of the investee. JKL Company reported the following net income or loss: 2020 - P1,000,000 2021 - (P5,000,000) 2022 - P300,000 Requirements: 1. Prepare the necessary journal entries to record the share of income or loss in 2020, 2021, and 2022. 2. What is the carrying value of the investment on December 31, 2020? December 31, 2021? December 31, 2022

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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PROBLEM 34

On January 1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000. The 10,000 shares are equivalent to 20% interest of the investee. JKL Company reported the following net income or loss:

2020 - P1,000,000
2021 - (P5,000,000)
2022 - P300,000

Requirements:
1. Prepare the necessary journal entries to record the share of income or loss in 2020, 2021, and 2022.
2. What is the carrying value of the investment on December 31, 2020? December 31, 2021? December 31, 2022?

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