What is the consolidated depreciation expense of equipment for the year ended December 31, 2010 Group of answer choices 1,000,000 1,200,000 1,100,000 1,300,000
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On January 1, 2010, Ayala Corporation acquired 80% of ordinary shares of Globe Company at fair value of net assets acquired. All assets of Globe company are fairly valued except for a blue office equipment with book value of P2,100,000 and fair value of P1,400,000. On June 30, 2010, Globe Company sold the said blue office equipment to Ayala Corporation at a selling price of P3,000,000. On June 30, 2010, the remaining useful life of the blue equipment is 3 years. On October 1, 2010, Ayala Corporation sold a 2 year-old red office equipment to Globe Company for P2,800,000 at a gain of P400,000. On October 1, 2010, the remaining useful life of the red equipment is 4 years.
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- On January 1, 2010, Ayala Corporation acquired 80% of ordinary shares of Globe Company at fair value of net assets acquired. All assets of Globe company are fairly valued except for a blue office equipment with book value of P2,100,000 and fair value of P1,400,000. On June 30, 2010, Globe Company sold the said blue office equipment to Ayala Corporation at a selling price of P3,000,000. On June 30, 2010, the remaining useful life of the blue equipment is 3 years. On October 1, 2010, Ayala Corporation sold a 2 year-old red office equipment to Globe Company for P2,800,000 at a gain of P400,000. On October 1, 2010, the remaining useful life of the red equipment is 4 years. What is the consolidated depreciation expense of equipment for the year ended December 31, 2010? What is the consolidated book value of equipment on December 31, 2010, respectively?On January 1, 2010, Ayala Corporation acquired 80% of ordinary shares of Globe Company at fair value of net assets acquired. All assets of Globe company are fairly valued except for a blue office equipment with book value of P2,100,000 and fair value of P1,400,000. On June 30, 2010, Globe Company sold the said blue office equipment to Ayala Corporation at a selling price of P3,000,000. On June 30, 2010, the remaining useful life of the blue equipment is 3 years. On October 1, 2010, Ayala Corporation sold a 2 year-old red office equipment to Globe Company for P2,800,000 at a gain of P400,000. On October 1, 2010, the remaining useful life of the red equipment is 4 years. What is the consolidated book value of equipment on December 31, 2010, respectively?On January 1, 2010, Ayala Corporation acquired 80% of ordinary shares of Globe Company at fair value of net assets acquired. All assets of Globe company are fairly valued except for a blue office equipment with book value of P2,100,000 and fair value of P1,400,000. On June 30, 2010, Globe Company sold the said blue office equipment to Ayala Corporation at a selling price of P3,000,000. On June 30, 2010, the remaining useful life of the blue equipment is 3 years. On October 1, 2010, Ayala Corporation sold a 2 year-old red office equipment to Globe Company for P2,800,000 at a gain of P400,000. On October 1, 2010, the remaining useful life of the red equipment is 4 years. What is the consolidated depreciation expense of equipment for the year ended December 31, 2010
- On June 30, 2016, Gab Company purchased 25% of the outstanding ordinary shares of IB Co. at a total cost of P2,100,000. The book value of IB Co.’s net assets on acquisition date was P7,200,000. For the following reasons, Gab was willing to pay more than book value for the IB Co. shares: IB Co. has depreciable assets with a current fair value of P180,000 more than their book value. These assets have a remaining useful life of 10 years. IB Co. owns a tract of land with a current fair value of P900,000 more than its carrying amount. All other identifiable tangible and intangible assets of IB Co. have current fair values that are equal to their carrying amounts. IB Co. reported net income of P1,620,000, earned evenly during the current year ended December 31, 2016. Also in the current year, it declared and paid cash dividends of P315,000 to its ordinary shareholders. Market value of IB Co.’s ordinary shares at December 31, 2016 is P9 million. Cabbage Company’s financial year-end is…On January 1, 2010, A Corporation acquired 80% of ordinary shares of G Company at fair value of net assets acquired. All assets of G company are fairly valued except for a blue office equipment with book value of P2,100,000 and fair value of P1,400,000. On June 30, 2010, G Company sold the said blue office equipment to A Corporation at a selling price of P3,000,000. On June 30, 2010, the remaining useful life of the blue equipment is 3 years. On October 1, 2010, A Corporation sold a 2-year-old red office equipment to G Company for P2,800,000 at a gain of P400,000. On October 1, 2010, the remaining useful life of the red equipment is 4 years. What is the consolidated book value of equipment on December 31, 2010, respectively? Ans. 3,250,000 (Show solution)On June 30, 2016, Gab Company purchased 25% of the outstanding ordinary shares of IB Co. at a total cost of P2,100,000. The book value of IB Co.’s net assets on acquisition date was P7,200,000. For the following reasons, Gab was willing to pay more than book value for the IB Co. shares: IB Co. has depreciable assets with a current fair value of P180,000 more than their book value. These assets have a remaining useful life of 10 years. IB Co. owns a tract of land with a current fair value of P900,000 more than its carrying amount. All other identifiable tangible and intangible assets of IB Co. have current fair values that are equal to their carrying amounts. IB Co. reported net income of P1,620,000, earned evenly during the current year ended December 31, 2016. Also in the current year, it declared and paid cash dividends of P315,000 to its ordinary shareholders. Market value of IB Co.’s ordinary shares at December 31, 2016 is P9 million. Cabbage Company’s financial year-end is…
- On January 1, 2010, Peter Company purchased 80% of the common stock of Pan Company for P316,000. On this date, Pan Company had common stock, other paid-in capital, and retained earnings of P40,000, P120,000, and P190,000, respectively. Peter Company’s common stock amounted to P500,000 and retained earnings of P200,000. On January 1, 2010, the only tangible assets of Pan that were undervalued were inventory and building. Inventory, for which the FIFO method is used, was worth P5,000 more than cost. Building which was worth P15,000 more than book value, has a remaining life of 8 years, and a straight line depreciation is used. Any remaining excess is full goodwill with an impairment for 2010 amounting to P3,000. Pan Company reported net income of P50,000 and paid dividends of P10,000 in 2010, while the parent’s reported net income amounted to P100,000 and paid dividends of P20,000. 10.)Determine the Consolidated Net Income Attributable to Controlling…On January 1, 2022, Pop Co. acquired 75% of the outstanding common shares of Soda Inc. for $161,250 cash. On that date, Soda had common shares of $156,250 and retained earnings of $31,250. At acquisition, the identifiable assets and liabilities of Soda had fair values that were equal to carrying amounts except for inventory, which had fair value $8,000 greater than carrying amount and plant and equipment, which had fair values $10,000 greater than carrying amounts. The plant and equipment had a remaining useful life of 5 years on January 1, 2022.Any goodwill will be tested yearly for impairment. Balance sheets as of December 31, 2022 are presented below: Cash Accounts receivable Inventory Land Plant & Equipment, net Investment in Soda Inc. - equity Current liabilities Bonds payable Common shares Retained earnings Pop Co. $ 10,000 Soda Inc. $ 5,000 38,750 42,250 75,250 62,500 50,000 100,000 150,000 175,000 168,500 $384,750 $492,500 $ 45,500 - 338,000 109,000 $492,500 $ 47,125 128,125…Pell Company purchased 90% of the stock of Silk Company on January 1, 2007, for $1,860,000, an amount equal to S60,000 in excess of the book value of equity acquired. All book values were equal to fair values at the time of purchase (i.e., any excess payment relates to subsidiary goodwill). On the date of purchase, Silk Company's retained earnings balance was $200,000. The remainder of the stockholders' equity consists of no-par common stock. During 2011, Silk Company declared dividends in the amount of $40,000, and reported net income of $160,000. The retained earnings balance of Silk Company on December 31, 2010 was $640,000. Pell Company uses the cost method to record its investment. No impairment of goodwill was recognized between the date of acquisition and December 31, 2011. Required: Prepare in general journal form the workpaper entries that would be made in the preparation of a consolidated statements workpaper on December 31, 2011.
- On March 1, 2017, Mindoro Company purchased 40% of the outstanding ordinary shares of Garapal Company for P3,500,000 when the net assets of Garapal amounted to P7,000,000. At acquisition date, the carrying amounts of the identifiable assets and liabilities of Garapal were equal to their fair value, except for equipment for which the fair value was P1,500,000 greater than its carrying amount and inventory whose fair value was P500,000 greater than its cost. The equipment has a remaining life of4 years and the inventory was all sold during 2017. Garapal Company reported net income of P5,000,000 for 2017 add paid P3,000,000 dividends during 2017. REQUIRED: Journal entries (no compounding of entries) Investment income Carrying amount of investment Under Equity Method Under Fair ValueAt the beginning of 2018, Esterlina Corporation purchased 40% of the ordinary shares outstanding of Mary Grace Incorporated for P15, 000,000 when the netassets of Mary Grace Incorporated amounted to P30,000,000. At the acquisition date, the carrying amounts of the identifiable assets and liabilities of Mary Grace Incorporated were equal to their fair value, except for the following: a. Equipment whose fair value was P7,000,000 greater than its carrying amount. b. Inventory whose fair value was P2,500,000 greater than its carrying amount. The equipment has a remaining life of 4 years, and the inventory was all sold during 2013. Mary Grace Incorporated has two classes of shares: Ordinary shares (par value, P100), 300,000 shares outstanding, 15% cumulative preference shares (par value, P50), 100,000 shares outstanding The investee reported the following net income (inclusive of enter-company transactions) and payment of cash dividend: Net Income Dividend payment 2018 20,000,000 5,000,000…. On January 1, 2011, Payne Corp. purchased 70% of Shayne Corp.'s P10 par common stock for P900,000. On this date, the carrying amount of Shayne's net assets was P1,000,000. The fair values of Shayne's identifiable assets and liabilities were the same as their carrying amounts except for plant assets (net), which were P200,000 in excess of the carrying amount. For the year ended December 31, 2011, Shayne had net income of P150,000 and paid cash dividends totaling P90,000. Excess attributable to plant assets is amortized over 10 years. In the December 31, 2011, consolidated balance sheet, non-controlling interest on a full-fair value basis should be reported at