Fred Corporation is a 90% owned subsidiary of John Corporation acquiredseveral years ago at book value (which is equal to fair value). For theyears 2020 and 2021, John and Fred report the following:John's separate income Fred's net income2020.2021P300,000 P400,00080,00060,000The only intercompany transaction between John and Fred during 2020and 2021 was the January 8, 2020 sale of land. The land had a book valueof P20,000 and was sold intercompany for P30,000, its appraised value atthe time of sale.1.)Assuming that it was Fred who sold the land to John (Upstream sale)on 2020 and subsequently sold it to third party on 2021, how much is thenon-controlling interest in net income of subsidiary for 2021?a. P7,000b. P6,000c. P5,000d. P6,100

In the Consolidated Financial Statement, the intercompany asset purchased or sold (including…

Answered: poration owhed sub several years ago at…

poration owhed sub several years ago at book value (whic years 2020 and 2021, John and Fred John's separate income Fred's net inc 2020. 2021 P300,000 P400,000 80,000 60,000

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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Question

Fred Corporation is a 90% owned subsidiary of John Corporation acquired
several years ago at book value (which is equal to fair value). For the
years 2020 and 2021, John and Fred report the following:
John's separate income Fred's net income
2020.
2021
P300,000 P400,000
80,000
60,000
The only intercompany transaction between John and Fred during 2020
and 2021 was the January 8, 2020 sale of land. The land had a book value
of P20,000 and was sold intercompany for P30,000, its appraised value at
the time of sale.
1.)Assuming that it was Fred who sold the land to John (Upstream sale)
on 2020 and subsequently sold it to third party on 2021, how much is the
non-controlling interest in net income of subsidiary for 2021?
a. P7,000
b. P6,000
c. P5,000
d. P6,100

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