In your audit of JJC Corporation you have found the following information: On January 1, 2022, JJC acquired 30% of Chiyo Company’s voting shares for P10,000,000.The fair value of Chiyo’s net identifiableassets is the same as per its book value. During 2022, Chiyo earned P6,000,000 and paid dividends of P2,500,000. Chiyo reported earnings of P7,000,000 for the six months ended June 30, 2023 and P9,000,000 for the year ended December 31, 2023. On July 1, 2023, JJC sold half of the investment in Chiyo for P7,000,000cash resulting to loss of significant influence. Chiyo paid dividends of P3,000,000 on October 1, 2023. On July 1, 2023, the investment is measured at fair value through other comprehensive income. The Fair Value of the retained Investment is P7,000,000 on July 1, 2023 and P7,300,000 on December31, 2023. Requirement a)Prepare the Journal entries for the year 2022 and 2023. b)How much is the investment balance to be presented byJJCin December 31, 2022?
In your audit of JJC Corporation you have found the following information:
On January 1, 2022, JJC acquired 30% of Chiyo Company’s voting shares for P10,000,000.The fair value of Chiyo’s net identifiableassets is the same as per its book value.
During 2022, Chiyo earned P6,000,000 and paid dividends of P2,500,000.
Chiyo reported earnings of P7,000,000 for the six months ended June 30, 2023 and P9,000,000 for the year ended December 31, 2023.
On July 1, 2023, JJC sold half of the investment in Chiyo for P7,000,000cash resulting to loss of significant influence. Chiyo paid dividends of P3,000,000 on October 1, 2023.
On July 1, 2023, the investment is measured at fair value through other comprehensive income. The Fair Value of the retained Investment is P7,000,000 on July 1, 2023 and P7,300,000 on December31, 2023.
Requirement
a)Prepare the
b)How much is the investment balance to be presented byJJCin December 31, 2022?
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