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Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On July 1, 2021, Diamante Co. paid P1,000,000 for 100,000 ordinary shares (40%) of Ashes Co. At that date, Ashes' net
assets totaled P 2,500,000 and the fair values of all Ashes identifiable assets and liabilities were equal to their carrying
amount. Ashes reported net income of P500,000 for 2021, of which P300,000 was for the 6 months ended December 31,
2021. Ashes paid cash dividends of P 250,000 on September 30, 2021. What amount of income should Diamante report
from the investment in Ashe Co.?
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essments
P 120,000
erences
P 100,000
Fessors
P 80,000
dents
P 200,000
abus
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