Vanilluxe Corporation acquired an 80% interest in Escavalier Company on January 1, 2019 for P1,225,000. On this date, a land with a carrying amount of P1,000,000 had a fair value of P1,050,000 and the capital stock and retained earnings of the two companies were as follows: The assets and liabilities of Escavalier were stated at their fair values when Vanilluxe acquired its 80% interest and the proportionate share in net identifiable assets was used to initially measure the non-controlling interest. Vanilluxe uses the cost method to account for its investment in Escavalier. The consolidated shareholders' equity at December 31, 2019: Capital stock Retained earnings Vanilluxe P3,150,000 1,400,000 Escavalier P875,000 175,000 Net income and dividends for 2019 for the affiliated companies were: Escavalier P157,500 Vanilluxe P525,000 315,000 Dividends payable December 31, 2019, 157,500 Net income Dividends declared P4,846,000 Answer not given O P5,201,000

Vanilluxe Corporation acquired an 80% interest in Escavalier Company on January 1, 2019 for P1,225,000. On this date, a land with a carrying amount of P1,000,000 had a fair value of P1,050,000 and the capital stock and retained earnings of the two companies were as follows: The assets and liabilities of Escavalier were stated at their fair values when Vanilluxe acquired its 80% interest and the proportionate share in net identifiable assets was used to initially measure the non-controlling interest. Vanilluxe uses the cost method to account for its investment in Escavalier. The consolidated shareholders' equity at December 31, 2019: Capital stock Retained earnings Vanilluxe P3,150,000 1,400,000 Escavalier P875,000 175,000 Net income and dividends for 2019 for the affiliated companies were: Escavalier P157,500 Vanilluxe P525,000 315,000 Dividends payable December 31, 2019, 157,500 Net income Dividends declared P4,846,000 Answer not given O P5,201,000

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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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

Vanilluxe Corporation acquired an 80% interest in Escavalier Company on
January 1, 2019 for P1,225,000. On this date, a land with a carrying amount of
P1,000,000 had a fair value of P1,050,000 and the capital stock and retained
earnings of the two companies were as follows: The assets and liabilities of
Escavalier were stated at their fair values when Vanilluxe acquired its 80%
interest and the proportionate share in net identifiable assets was used to initially
measure the non-controlling interest. Vanilluxe uses the cost method to account
for its investment in Escavalier. The consolidated shareholders' equity at
December 31, 2019:
Capital stock
Retained earnings
Vanilluxe
P3,150,000
1,400,000
Escavalier
P875,000
175,000
Net income and dividends for 2019 for the affiliated companies were:
Escavalier
P157,500
Vanilluxe
P525,000
315,000
Dividends payable December 31, 2019, 157,500
Net income
Dividends declared
P4,846,000
O Answer not given
P5,201,000
P5,043,500
O P4,886,000

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