What total amount should be considered as owner-occupied property and included in property, plant and equipment in the consolidated statement of financial position?
Q: In its first year, Firm KZ recognized $457,500 ordinary business income and a $13,250 loss on the…
A: Book income is the income shown in the financial statements of the business.Taxable income is the…
Q: Prant Company acquired all of Sedford Corporation's assets and liabilities on January 1, 20X2, in a…
A: Business acquisition is when an entity acquires most or all shares of the target company. The…
Q: alculate for Parent for the year ended December 31, year 3: a) total consolidated income
A: Parent company: A company having controlling interest in another company is known as parent company.…
Q: Required: a. Compute Sigma's taxable income assuming that it used the straight-line method to…
A: Taxable income refers to the portion of an individual's earnings that is subject to income tax. It's…
Q: January 18
A: When a company acquires control of another company, the purchase price is allocated to the assets…
Q: Company A owns 90 percent of the common stock of Company B. At the beginning of 2021, Company B sold…
A: Gains on sale of land recognised in financial statement is sales value - cost of land. However…
Q: Shimmer Incorporated is a calendar-year-end, accrual-method corporation. This year, it sells the…
A: Answer:- Taxable income:- The income on which the amount of tax is calculated is known as taxable…
Q: XYZ Co. is a sole proprietorship owned by X. It was organized on January 1, 2018 with X's investment…
A: As per the double-entry bookkeeping system, the total of the owners' equity and liabilities equals…
Q: Corporation used debentures with a par value of $644,000 to acquire 100 percent of Sord- On that…
A: Cash and Recievables $ 48,000Inventory $ 1,82,000Land $ 92,000Plant and…
Q: 2-On Jan 2, 2020, Parent sells to its wholly owned investee equipment that had cost $250,000. The…
A: Solution:- A)Compute the difference between the annual depreciation expense when Parent owned the…
Q: As of December 31, 20X4, Blue Co.’s statement of financial position shows the book values of…
A: Amount of Goodwill = Purchase consideration paid for net assets - Fair value of net assets acquired…
Q: The Investor acquired 75% of Investee on January 1, 2020 for $105, At acquisition the fair value of…
A: 1. The fair value of consideration 105,000 Add: Fair value of non controlling (NCI) 35,000…
Q: Barney Company is an 80% owned subsidiary Hayes Inc. During 20X2, Hayes sold land to Barney for…
A: Consolidation of financial statements is a critical process for companies with subsidiaries,…
Q: On January 1, Year 1, East Company purchased West Company. East Company paid $670,000 West's books…
A: Goodwill reflects non-individually identifiable or separable characteristics such as the acquired…
Q: Required On the 2021 consolidated balance sheet, what value should be reported for land?
A: The consolidated balance sheet is used to show the financial position of the parent company as well…
Q: Breslin Incorporated made a capital contribution of investment property to its 100-percent-owned…
A: A tax base is the total worth of all assets, income, and economic activity that a taxation body,…
Q: Placid Lake Corporation acquired 80 percent of the outstanding voting stock of Scenic, Inc., on…
A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…
Q: On December 1, 2021, ABC Company acquired all the assets and liabilities of XYZ Inc. issuing 100,000…
A:
Q: On January 1, Year 1, RAK, Inc. acquired a 25% interest in Tech Corp. for $375,000. At the date of…
A: A business becomes a shareholder or equity investor in another business when it buys shares or…
Q: Nuland International Corporation recently acquired 40 percent of Scott Trading Company and…
A: Searching the US literature, we get, FASB Accounting Standards Codification (ASC) para 280-10-55-2 -…
Q: 1) Explain how goodwill is tested for impairment for a reporting unit. 2) Determine the amount, if…
A: Introduction:- Goodwill is an intangible asset. Goodwill is the amount between a business's…
Q: a. Prepare Pacifica's entries to account for the consideration transferred to the former owners of…
A: Journal entries are those entries that are reported into the books of accounts of the company and…
Q: E Company Ltd, a reporting entity, purchases all the issued shares of D Company Pty Ltd for…
A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…
Q: Uramilaben
A: Detailed explanation: Dividend income is computed by subtracting the fair market value of the…
Q: GIGİ Group completed an acquisition of an interest in another business, Venice Company, during the…
A: As per the IFRS after acquiring the the stake in any entity, Investment in that entity will be shown…
Q: ABC Company acquired 80% of DEF Company prior to 2023. During 2023 the individual companies included…
A: Consolidated financial statements refers to the statements which shows the combination of the value…
Q: Blue Corp. previously operated as a C corporation. At the beginning of 2020, Blue Corp. made a valid…
A: Sell land A=130000 B=100000 Total =230000 Acquised cost AB =50000+105000 that =155000 Blue corps…
Q: On 20 December 20x1, a 60%-owned Subsidiary paid rental of $200,000 to its Parent. The Parent…
A: Subsidiary's Acc / Bank Acc Dr. $2,00,000 To Rental Income $2,00,000 (Being Rental Income Recorded)
Q: Building Asset Sparkle Corporation stock Sales Price Cost $675,000 262,500 $ 697,000 191,000…
A: Taxable income:The income on which the amount of tax is calculated is known as taxable income. The…
Q: Oz Corporation has the following assets at year-end: Patents (net), $26,000; Land, $40,000;…
A: Preparation of partial balance sheet ( property , plant and equipment section) of OZ corporation are…
Q: At the beginning of the current year, Jason Company acquired non-trading equity instrument for…
A: Solution: Cost of equity instruments = P4,000,000 + P700,000 = P4,700,000 Fair value of instrument…
Q: Shimmer Incorporated is a calendar-year-end, accrual-method corporation. This year, it sells the…
A: Income that is subject to taxation: Taxable income is the amount of income that is used to determine…
Q: Plug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying…
A: Consolidation entries. Consolidated net income Balance assigned to the non-controlling interest.
Q: In the year ended June 30 2021, Lorelai Ltd, a reporting entity, acquired the assets and assumed the…
A: When a company's ownership is acquired by another company, is is said to be an acquisition. When 2…
Q: On December 31, 20X8, Mercury Corporation acquired 100 percent ownership of Saturn Corporation. On…
A: Acquisition of the company means when one company acquires another company either only some…
Q: Plug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying…
A: Consolidation is an activity in which financial statements of a parent and its subsidiary should be…
Q: горerty: and with future use undetermined actory rented to Courage Hodey's sub
A: According to IAS 40 investment Property,the carrying amount recognized as investment property the…
Q: Ted Ltd, an ultimate parent reporting entity, holds a 24% interest in the voting shares of Lasso…
A: Investment in Associates and Joint venture and Subsidiary Equity Accounting method - This method is…
Q: Professor Corporation acquired 70 percent of Scholar Corporation's common stock on December 31,…
A: Once the consolidated worksheet adjustments have been made, the consolidated financial statements…
MMM Company and its subsidiaries own the following properties at year end: Land held by MMM for undetermined use = 5,000,000; A vacant building owned by MMM and to be leased out under an operating lease = 3,000,000; Property held by a subsidiary of MMM, a real estate firm in the ordinary course of business = 2,000,000; Property held by MMM for use in production = 4,000,000; Building owned by a subsidiary of MMM and for which the subsidiary provides security and maintenance services to the lessees = 1,500,000; Land leased by MMM to a subsidiary under an operating lease = 2,500,000; Property under construction for use as investment property = 6,000,000; Land held for future factory site = 3,500,000; Machinery leased out by MMM to an unrelated party under an operating lease = 1,000,000. What total amount should be considered as owner-occupied property and included in property, plant and equipment in the consolidated
Step by step
Solved in 2 steps with 2 images
- Michael Chan purchased 100% of the issued shares of Quality Rest Inc., a Canadian-controlled private corporation, which owns and operates an assisted-living retirement home in Ontario. Quality Rest has a December 31 fiscal year end. The transaction closed on October 1, 2020. At that time, the values of certain assets owned by Quality Rest were as follows: Cost Land Building Furniture and fixtures Computer equipment Inventory Marketable securities Incorporation/organization $132,000 260,000 100,000 January 2019-December 31, 2019 January 1, 2020-September 30, 2020 October 1, 2020-December 31, 2020 January 1, 2021-December 31, 2021 13,200 60,500 26,400 11,000 Business Income UCC N/A (loss) ($100,000) (220,000) (70,000) 40,000 99,000 71,500 6,600 costs Michael selected December 31, 2020 as the first fiscal year-end for Quality Rest after the acquisition. The following is a schedule of Quality Rest's income and unused losses for the period January 1, 2019 through December 31, 2021. N/A N/A…MMM Company and its subsidiaries own the following properties at year end: Land held by MMM for undetermined use = 5,000,000; A vacant building owned by MMM and to be leased out under an operating lease = 3,000,000; Property held by a subsidiary of MMM, a real estate firm in the ordinary course of business = 2,000,000; Property held by MMM for use in production = 4,000,000; Building owned by a subsidiary of MMM and for which the subsidiary provides security and maintenance services to the lessees = 1,500,000; Land leased by MMM to a subsidiary under an operating lease = 2,500,000; Property under construction for use as investment property = 6,000,000; Land held for future factory site = 3,500,000; Machinery leased out by MMM to an unrelated party under an operating lease = 1,000,000. What is the total investment property that should be reported in the consolidated statement of financial position of the parent and its subsidiaries?Eragon Company and its subsidiaries own the following properties at year-end: Land held by Eragon for undetermined use 5,000,000 A vacant building owned by Eragon and to be leased out under an operating lease 3,000,000 Property held by a subsidiary of Eragon, a real estate firm, in the ordinary course of business 2,000,000 Property held by Eragon for use in production 4,000,000 Building owned by a subsidiary of Eragon and for which the subsidiary provides security and maintenance services to the lessees 1,500,000 Land leased by Eragon to a subsidiary under an operating lease 2,500,000 Property under construction for use as investment property 6,000,000 Land held for future factory site 3,500,000 Machinery leased out by Eragon to an unrelated party under an operating lease 1,000,000 4. What is the total investment property that should be reported in the consolidated statement of financial position of the parent and its subsidiaries? a. 12,000,000 b. 15,500,000 c. 10,500,000 d. 9,500,000…
- On December 31, Pacifica, Inc., acquired 100 percent of the voting stock of Seguros Company. Pacifica will maintain Seguros as a wholly owned subsidiary with its own legal and accounting identity. The consideration transferred to the owner of Seguros included 56,570 newly issued Pacifica common shares ($20 market value, $5 par value) and an agreement to pay an additional $130,000 cash if Seguros meets certain project completion goals by December 31 of the following year. Pacifica estimates a 50 percent probability that Seguros will be successful in meeting these goals and uses a 4 percent discount rate to represent the time value of money. Immediately prior to the acquisition, the following data for both firms were available: Seguros Seguros Book Fair Pacifica Values Values $(1,270,000) 889,000 (381,000) Revenues Expenses Net income $ Retained earnings, 1/1 $(1,048,000) (381,000) 139,000 Net income Dividends declared Retained earnings, 12/31 $(1,290,000) $ 121,000 146,000 457,000 $…On January 1, 2021, Entity A and Entity B incorporated AB Company. The contractual agreement provided that the decisions on relevant activities will require the unanimous consent of both Entity A and Entity B, and they will have right to the net assets of AB Company. Entity A and Entity B invested P400,000 and P600,000 respectively, equivalent to 40:60 capital interest of AB Company. The financial statements of AB Company provided the following data for its two-year operation (see image below).1. How much is the balance of Investment in Joint Venture to be reported by Entity B in its Statement of Financial Position at December 31, 2022? 2. How much is the balance of Investment in Joint Venture to be reported by Entity A in its Statement of Financial Position at December 31, 2021? _______________Cred Company’s board of directors declared a property dividend to its incorporators in the form of the company’s equipment and machinery that had a carrying amount on June 30, 2020, the date of declaration of P5,000,000. The fair value less cost to distribute of these assets on the same date amounted to P5,500,000. The date of distribution was scheduled on January 31, 2021. On December 31, 2020, the fair value less cost to distribute of the machinery and equipment was estimated at P4,800,000 and further declined on the date of distribution on January 31, 2021, at a fair value less cost to distribute of P4,300,000. - What is the amount to be recognized in profit or loss for the year ended December 31, 2020? - What is the amount to be recognized in profit or loss in 2021 for the distribution?
- Placid Lake Corporation acquired 80 percent of the outstanding voting stock of Scenic, Inc., on January 1, 2020, when Scenic had a net book value of $630,000. Any excess fair value was assigned to intangible assets and amortized at a rate of $6,000 per year. Placid Lake's 2021 net income before consideration of its relationship with Scenic (and before adjustments for intra-entity sales) was $530,000. Scenic reported net income of $340,000. Placid Lake declared $160,000 in dividends during this period; Scenic paid $63,000. At the end of 2021, selected figures from the two companies' balance sheets were as follows: Placid Lake Scenic Inventory $ 370,000 $ 113,000 Land 830,000 430,000 Equipment (net) 630,000 530,000 During 2020, intra-entity sales of $190,000 (original cost of $88,000) were made. Only 20 percent of this inventory was still held within the consolidated entity at the end of 2020. In 2021, $320,000 in intra-entity sales were made…Goku Corporation is an 80% owns subsidiary of Vegeta Corporation. In 2018, Goku sold land net cost of P30,000 to Vegeta for P50,000. Vegeta held the land for 8 years before selling it in 2019 to Frieza Company, an unrelated entity, for P110,000. The consolidated income statement of Vegeta and its subsidiary in 2019, Goku, will show a gain on the sale of land of: 80,000 60,000 32,000 48,000Professor Corporation acquired 70 percent of Scholar Corporation's common stock on December 31, 20X4, fr $102,200. The fair value of the noncontrolling interest at that date was determined to be $43,800. Data from the balance sheets of the two companies Included the following amounts as of the date of acquisition: Item Cash Accounts Receivable Inventory Land Buildings & Equipment Less: Accumulated Depreciation. Investment in Scholar Corporation Total Assets Accounts Payable Mortgage Payable Common Stock Retained Earnings Total Liabilities & Stockholders' Equity Professor Corporation $ 50,300 90,000 Scholar Corporation $21,000 44,000 130,000 75,000 60,000 30,000 410,000 250,000 (150,000) (80,000) 102,200 $ 692,500 $340,000 $ 152,500 $ 35,000 250,000 180,000 80,000 40,000 210,000 85,000 $ 692,500 $340,000 At the date of the business combination, the book values of Scholar's assets and liabilities approximated fair value except for Inventory, which had a fair value of $81,000, and…
- Cred Company’s board of directors declared a property dividend to its incorporators in the form of the company’s equipment and machinery that had a carrying amount on June 30, 2020, the date of declaration of P5,000,000. The fair value less cost to distribute of these assets on the same date amounted to P5,500,000. The date of distribution was scheduled on January 31, 2021. On December 31, 2020, the fair value less cost to distribute of the machinery and equipment was estimated at P4,800,000 and further declined on the date of distribution on January 31, 2021, at a fair value less cost to distribute of P4,300,000. - What is the carrying amount of the machinery and equipment to be distributed as property dividends on December 31, 2020? - What is the dividend payable recognized on June 30, 2020?Parent Corporation acquired 80% of Subsidiary Co. for P 5,000,000 on January 2, 2021. On this date, Subsidiary Co. reported Ordinary share capital of P 3,000,000 and Retained Earnings of P2,000,000. Investment is accounted for using the cost method. Change in assets to fair values were undervaluation of P 300,000 and P400,000 in Equipment and Building respectively. Both assets have 10-year remaining useful life. An annual review revealed that goodwill has not been impaired.Subsidiary Co. earned income and paid dividends as follows: 2021 2022 2023Net Income 1,000,000 1,200,000 1,3000,000Dividends 400,000 500,000 600,000The balance of the investment account at December 31, 2023 is: a. P5,924,000 b. P5,000,000 c. P5,744,000 d. P7,660,00031 and are shown in the table given below. The following items were overlooked when the statements were prepared: • The Year 5 gain on sale of assets resulted from the subsidiary selling equipment to the parent on September 30. The parent immediately leased the equipment back to the subsidiary at an annual rental of $13,200. This was the only intercompany rent transaction that occurred each year. The equipment had a remaining life of five years on the date of the intercompany sale. The Year 6 gain on sale of assets resulted from the January 1 sale of a building, with a remaining life of seven years, by the subsidiary to the parent. • Both gains were taxed at a rate of 40%. CONSOLIDATED INCOME STATEMENTS Year 5 $ 755,000 8,800 3,300 Miscellaneous revenues Gain on sale of assets Rental revenue Miscellaneous expenses Rental expense Depreciation expense Income tax expense Non-controlling interest Net income NCI Required: Prepare correct consolidated income statements for Years 5 and 6.…
