st of Oss E
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Determine the net income attributable to P Corporation using the information below

Transcribed Image Text:Y Inc. is a wholly owned subsidiary of P Corporation. The following are excerpts from the 2019 condensed statements of
financial position of the two companies:
P Corp.
P500,000
2,000,000
Y Inc.
Sales to Y
Sales to others
Cost of goods sold from P
Cost of goods sold from others
Gross profit
P1,500,000
400,000
950,000
P150,000
1,750,000
P750,000
The sales of P to Y are made on the same terms as those made to others.
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Follow-up Question
What is the formula for the "Net Income attributable to P Corporation"? How did you come up with 700,000 as the answer when:
3,500,000+2,700,000+800,000-100,000 = 6,900,000
3,500,000+2,700,000+800,000 = 7,000,000
Neither does not give 700,000.
Solution
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