Problem 9On January 1, 2012, Cheetah Company purchased 30% interest in Pod Company for P2,500,000. On thisdate Pod's shareholders' equity was P5,000,000. The carrying amount of Pod's identifiable net assetsapproximated their fair values, except for land whose fair value exceeded its carrying amount by P2,000,000.Pod reported net income of P1,000,000 for 2012 and paid no dividends. Cheetah accounts for thisinvestment using the equity method.In its December 31, 2012 statement of financial position, what amount should Cheetah report as investmentin associate?a. 2,100,000b. 2,200,000c. 2,800,000d. 2,760,000Problem 10On January 1, 2020, Bonus Company acquired 10% of the outstanding ordinary shares of Bill Company.On January 1, 2021, Bonus gained the ability to exercise significant influence over financial and operatingcontrol of Bill by acquiring an additional 20% of Bill's outstanding ordinary shares.ACC 205: Intermediate Accounting IClassification: PublicThe two purchases were made at prices proportionate to the value assigned to Bill's net assets, whichequaled their carrying amounts. For the years ended December 31, 2020 and 2021, Bill reported thefollowing:20202021Dividend paid2,000,0006,000,0003,000,0006,500,000Net incomeWhat total amount of revenue should Bonus Company include in profit or loss for the year ended December31, 2021?a. 1,000,000b. 1.950,000c. 2,350,000d. 1,550,000

Problem 9 On January 1, 2012, Cheetah Company purchased 30% interest in Pod Company for P2,500,000. On this date Pod's shareholders' equity was P5,000,000. The carrying amount of Pod's identifiable net assets approximated their fair values, except for land whose fair value exceeded its carrying amount by P2,000,000. Pod reported net income of P1,000,000 for 2012 and paid no dividends. Cheetah accounts for this investment using the equity method. In its December 31, 2012 statement of financial position, what amount should Cheetah report as investment in associate? a. 2,100,000 b. 2,200,000 c. 2,800,000 d. 2,760,000

Problem 9 On January 1, 2012, Cheetah Company purchased 30% interest in Pod Company for P2,500,000. On this date Pod's shareholders' equity was P5,000,000. The carrying amount of Pod's identifiable net assets approximated their fair values, except for land whose fair value exceeded its carrying amount by P2,000,000. Pod reported net income of P1,000,000 for 2012 and paid no dividends. Cheetah accounts for this investment using the equity method. In its December 31, 2012 statement of financial position, what amount should Cheetah report as investment in associate? a. 2,100,000 b. 2,200,000 c. 2,800,000 d. 2,760,000

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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Income
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