PROBLEM III.On January 1, 2020, P Corporation purchase 80% of S Company's ordinary share for P810,000. P37,500 of the excess isattributable to goodwill and the balance to depreciable asset with economic life of ten years. NCI is measured at fair valueon the date of acquisition. On this date, shareholders' equity of the two companies were as follows:P CorporationS CompanyOrdinary shareP1,312,500P300,000Retained earnings1,950,000525,000On December 31, 2020, S Company reported net income of P131,250 and paid dividends of P45,000 to Party. Party reportedearnings from its own operations of 356,250 and paid dividends of P172,500. Goodwill has been impaired and should bereported at P7,500 on December 31, 2020.1. Net income attributable to parent2. NCINIS

Net income is the income received after deduction of expenses and taxes.Net income is the actual…

PROBLEM III. On January 1, 2020, P Corporation purchase 80% of S Company's ordinary share for P810,000. P37,500 of the excess is attributable to goodwill and the balance to depreciable asset with economic life of ten years. NCI is measured at fair value on the date of acquisition. On this date, shareholders' equity of the two companies were as follows: P. Corporation S Company Ordinary share Retained earnings P1,312,500 1,950,000 P300,000 525,000 On December 31, 2020, S Company reported net income of P131,250 and paid dividends of P45,000 to Party. Party reported earnings from its own operations of 356,250 and paid dividends of P172,500. Goodwill has been impaired and should be m500 31200

PROBLEM III. On January 1, 2020, P Corporation purchase 80% of S Company's ordinary share for P810,000. P37,500 of the excess is attributable to goodwill and the balance to depreciable asset with economic life of ten years. NCI is measured at fair value on the date of acquisition. On this date, shareholders' equity of the two companies were as follows: P. Corporation S Company Ordinary share Retained earnings P1,312,500 1,950,000 P300,000 525,000 On December 31, 2020, S Company reported net income of P131,250 and paid dividends of P45,000 to Party. Party reported earnings from its own operations of 356,250 and paid dividends of P172,500. Goodwill has been impaired and should be m500 31200

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 24E

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