Santo, Inc. acquired 30% of Nino Corp.'s voting stock on January 1, 2008 for P360,000. During 2008, Nino earned P150,000 and paid dividends of P90,000. Santo's 30% interest in Nino gives Santo the ability to exercise significant influence over Nino's operating and financial policies. During 2009, Nino earned P180,000 and paid dividends of P60,000 on April 1 and P60,000 on October 1. On July 1, 2009, Santo sold half of its stock in Nino for P237,000 cash.
Santo, Inc. acquired 30% of Nino Corp.'s voting stock on January 1, 2008 for P360,000. During 2008, Nino earned P150,000 and paid dividends of P90,000. Santo's 30% interest in Nino gives Santo the ability to exercise significant influence over Nino's operating and financial policies. During 2009, Nino earned P180,000 and paid dividends of P60,000 on April 1 and P60,000 on October 1. On July 1, 2009, Santo sold half of its stock in Nino for P237,000 cash.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Santo, Inc. acquired 30% of Nino Corp.'s voting stock on January 1, 2008 for P360,000. During 2008, Nino earned P150,000 and paid dividends of P90,000. Santo's 30% interest in Nino gives Santo the ability to exercise significant influence over Nino's operating and financial policies. During 2009, Nino earned P180,000 and paid dividends of P60,000 on April 1 and P60,000 on October 1. On July 1, 2009, Santo sold half of its stock in Nino for P237,000 cash.
What should be the gain on sale of this investment in Santo's 2009 income statement?
a. P57,000
c. P52,500
b. P43,500
d. P34,500
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