On January 1, 2015, Petron Enterprises purchased 24,000 outstanding shares of Shell Corporation in theopen market for P756,000. The trial balances of PETRON and SHELL as of January 1 and December 31, 2015are presented below:PETRON ENTERPRISESSHELL CORPORATIONDec. 31P 153,600240,000150,00080,000Dec. 31January 1P 109,000300,000140,000January 1P 15,00035,00040,000170,000200,000450,000P 48,00070,00080,000170,000190,000405,000CashAccounts receivableInventoriesLandBuildingsEquipmentInvestment in Shell Co.250,000756,000P1,555,000P 175,000349,000756,000P1,728,600P 150,600--P 910,000210,000P 963,000125,000ТОTALAccounts payableShare capital, Petron (P50par)Share capital, Shell (P10par)Share premiumRetained earnings200,000200,000300,000300,000400,000780,000P1,555,000400,000978,000P1,728,600538,000P 963,000400,000P 910,000At the date of acquisition the following assets of SHELL COMPANY had book values that were different fromtheir respective fair values:Book ValueFair ValueP 40,000170,000200,000450,000P 70,000220,000270,000510,000InventoriesLandBuilding, netEquipment, netAll other assets and liabilities had book values approximately equal to their respective fair values. On January1, 2015, the building had a remaining useful life of 20 years and that of the equipment, 10 years. FIFOinventory costing is used. GOODWILL was IMPAIRED by P5,000 in 2015. The following are the combined statements of income and retained earnings for the affiliated companies forthe year ended December 31, 2015.PETRONSHELLP 1,200,00048,000500,000400,000P 348,000780,000150,000P 978,000SalesDividend incomeP 700,000250,000252,000P 198,000P 400,00060,000P 538,000Cost of salesExpensesNet incomeRetained earnings, January 1Dividends paidRetained earnings, December 3128. How much total depreciable assets will be reported in the consolidated balance sheet at January 1,2015?P1,030,000P900,900c. P909,000d. P900,090а.b.29. How much equity will be attributable to (1) owners of PETRON Enterprises and (2) the non-controllinginterest of SHELL Corporation in the consolidated balance sheet at January 1, 2015?(1) P1,830,000 and (2) P198,000(1) P1,380,000 and (2) P189,000(1) P1,830,000 and (2) P189,000(1) P1,308,000 and (2) P198,000a.b.с.d.30. How much is the goodwill or (negative goodwill/IFA) upon the acquisition of SHELL COMPANY byPETRON CORPORATION?P (53,000)P 35,000c. P (35,000)d. P P30,500а.b.31. How much will be the amount of inventory that will be recognized in the consolidated balance sheet atDecember 31, 2015?P 260,000b.c. P230,000d. P210,000а.P 320,00032. Calculate the consolidated net income for the year 2015.P 535,400P 453,500c. P 543,500d. P 455,300а.b.33. Calculate the consolidated net income in 2015 attributable to the shareholders of PETRONCORPORATION.P 422,800P 482,200c. P 428,200d. P 420,280a.b.34. How much is the general ledger balance of goodwill on December 31, 2015 after impairment?c. P 53,000d. PP 35,000P 30,000а.b.35. How much will be the equity of the non-controlling-interest in the consolidated balance sheet atDecember 31, 2015?P 270,700P 277,000c. P207,770d. P207,700a.b.

Percentage holding of Patron company = 80%(24000/30000)*100

The following are the combined statements of income and retained earnings for the affiliated companies for the year ended December 31, 2015. PETRON P 1,200,000 48,000 500,000 400,000 P 348,000 780,000 150,000 P 978,000 SHELL P 700,000 Sales Dividend income Cost of sales 250,000 252,000 P 198,000 P 400,000 60,000 P 538,000 Expenses Net income Retained earnings, January 1 Dividends paid Retained earnings, December 31 28. How much total depreciable assets will be reported in the consolidated balance sheet at January 1, 2015? P1,030,000 P900,900 c. P909,000 d. P900,090 а. b. 29. How much equity will be attributable to (1) owners of PETRON Enterprises and (2) the non-controlling interest of SHELL Corporation in the consolidated balance sheet at January 1, 2015? (1) P1,830,000 and (2) P198,000 (1) P1,380,000 and (2) P189,000 (1) P1,830,000 and (2) P189,000 (1) P1,308,000 and (2) P198,000 a. b. C. d. 30. How much is the goodwill or (negative goodwill/IFA) upon the acquisition of SHELL COMPANY by PETRON CORPORATION? P (53,000) P 35,000 с. Р (35,000) d. P P30,500 а. b.

The following are the combined statements of income and retained earnings for the affiliated companies for the year ended December 31, 2015. PETRON P 1,200,000 48,000 500,000 400,000 P 348,000 780,000 150,000 P 978,000 SHELL P 700,000 Sales Dividend income Cost of sales 250,000 252,000 P 198,000 P 400,000 60,000 P 538,000 Expenses Net income Retained earnings, January 1 Dividends paid Retained earnings, December 31 28. How much total depreciable assets will be reported in the consolidated balance sheet at January 1, 2015? P1,030,000 P900,900 c. P909,000 d. P900,090 а. b. 29. How much equity will be attributable to (1) owners of PETRON Enterprises and (2) the non-controlling interest of SHELL Corporation in the consolidated balance sheet at January 1, 2015? (1) P1,830,000 and (2) P198,000 (1) P1,380,000 and (2) P189,000 (1) P1,830,000 and (2) P189,000 (1) P1,308,000 and (2) P198,000 a. b. C. d. 30. How much is the goodwill or (negative goodwill/IFA) upon the acquisition of SHELL COMPANY by PETRON CORPORATION? P (53,000) P 35,000 с. Р (35,000) d. P P30,500 а. b.

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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