6. David Company acquired 200,000 ordinary shares of Jonathan Company and 250,000 ordinary shares of Aaron Company. Aaron Company and Jonathan Company had 1,000,000 and 2,000,000 ordinary shares outstanding, respectively. Jonathan Company reported net income of P12,000,000 and paid dividends of P4,500,000 during the current year. On the other hand, the Aaron Company reported net income of P8,200,000 and paid dividends of P3,000,000 during the current year. How much is the dividend income to be reported for the current year? a. 300,000 450,000 C. 650,000 d. 1,200,000

6. David Company acquired 200,000 ordinary shares of Jonathan Company and 250,000 ordinary shares of Aaron Company. Aaron Company and Jonathan Company had 1,000,000 and 2,000,000 ordinary shares outstanding, respectively. Jonathan Company reported net income of P12,000,000 and paid dividends of P4,500,000 during the current year. On the other hand, the Aaron Company reported net income of P8,200,000 and paid dividends of P3,000,000 during the current year. How much is the dividend income to be reported for the current year? a. 300,000 450,000 C. 650,000 d. 1,200,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

At the beginning of current year, Remington Company acquired 200,000 ordinary shares of Universal Company for P 9,000,000.At the time of purchase, Universal Company had outstanding 800,000 shares with a carrying amount of P 36,000,000.The following events took place during the current year:• Universal Company reported net income of P 1,800,000 for the current year.• Remington Company received from Universal Company a dividend of P 3.00 per ordinary share or P 600,000.• The market value of Universal Company share had temporarily declined to P 40.Remington Company has elected irrevocably to measure the investment at fair value through other comprehensive income. What is the carrying amount of the investment at year-end? * a. 9,000,000 b. 8,000,000 c. 9,300,000 d. 9,450,000
On Jan 1, 20X8, Banawe Company purchased 80% of the outstanding shares of Malate Company at a cost of P4,000,000. On that date, Malate had P2,500,000 of capital stock and P3,500,000 of retained earnings. For 20X8, Banawe had income of P1,400,000 form its separate operations and paid dividends of P750,000. Malate on the other hand reported income of P325,000 and paid dividends of P150,000 on December 1, 20X8. All the assets and liabilities of Malate have book values equal to their fair market values. Assume all income was earned evenly throughout the year except for an intercompany transaction on October 1, 20X8 when Banawe purchased a machinery from Malate for P500,000. The book value of the machinery on that date amounted to P600,000 and accumulated depreciation of P400,000 and is already reflected in the income of Malate indicated above. The machinery is expected to have a remaining useful life of 5 years from the date of sale. In the December 31, 20X8 consolidated financial…
Inconsiderate Company acquired 100,000 ordinary shares of Channel Company and 300,000 ordinary shares of Painful Company. Both Channel Company and Painful Company had 1,000,000 ordinary shares outstanding. Channel Company reported net income of P4,500,000 and paid dividends of P3,000,000 during the current year. Painful Company reported net income of P 4,000,00 and paid dividends of P1,000,000 during the current year. What total amount of income from the investments should be reported by the investor for the current year?
On Jan 1, 20X8, Banawe Company purchased 80% of the outstanding shares of Malate Company at a cost of P4,000,000. On that date, Malate had P2,500,000 of capital stock and P3,500,000 of retained earnings. For 20X8, Banawe had income of P1,400,000 form its separate operations and paid dividends of P750,000. Malate on the other hand reported income of P325,000 and paid dividends of P150,000 on December 1, 20X8. All the assets and liabilities of Malate have book values equal to their fair market values. Assume all income was earned evenly throughout the year except for an intercompany transaction on October 1, 20X8 when Banawe purchased a machinery from Malate for P500,000. The book value of the machinery on that date amounted to P600,000 and accumulated depreciation of P400,000 and is already reflected in the income of Malate indicated above. The machinery is expected to have a remaining useful life of 5 years from the date of sale. In the December 31, 20X8 consolidated financial…
On July 1, 20x6 TRUST Company purchased 80% of the outstanding shares of DUREX Company at a cost of Pl,600,000. on that date, DUREX had P1,000,000 of capital stock and P1,400,0a00 of retained earnings. For 20x6, TRUST had income of P560,000 from its separate operations and paid dividends of P300,000. For 20x6, DUREX reported income of P130,000 and paid dividends of P60,000. All the assets and liabilities of DUREX have book values equal to their respective fair market values. Assume income was earned evenly throughout the year except for the intercompany transaction on October 1. On October 1, TRUST purchased an equipment from DUREX for P200,000. The book value of the equipment on that date was P240,000. The loss of P40,000 is reflected in the income of DUREX indicated above. The equipment is expected to have a useful life of 5 years from the date of sale. In the December 31, 20x6 consolidated statement of financial position, how much is the consolidated net income attributable to the…
On Jan 1, 20X8, Banawe Company purchased 80% of the outstanding shares of Malate Company at a cost of P4,000,000. On that date, Malate had P2,500,000 of capital stock and P3,500,000 of retained earnings. For 20X8, Banawe had income of P1,400,000 form its separate operations and paid dividends of P750,000. Malate on the other hand reported income of P325,000 and paid dividends of P150,000 on December 1, 20X8. All the assets and liabilities of Malate have book values equal to their fair market values. Assume all income was earned evenly throughout the year except for an intercompany transaction on October 1, 20X8 when Banawe purchased a machinery from Malate for P500,000. The book value of the machinery on that date amounted to P600,000 and accumulated depreciation of P400,000 and is already reflected in the income of Malate indicated above. The machinery is expected to have a remaining useful life of 5 years from the date of sale. In the December 31, 20X8 consolidated financial…
At the beginning of the current year, Remington Company acquired 200,000 ordinary shares of Universal Company for P9,000,000.At the time of purchase, Universal Company had outstanding 800,000 shares with carrying amount of P36,000,000.The following events took place during the current year:- Universal Company reported net income of P1,800,000 for the current year- Remingtong Company received from Universal Company a dividend of P3.00 per ordinary share or P600,000.- The market value of Universal Company share had temporarily declined to P40. Assuming the investment is a FA@FVPL. What is the carrying amount of the investment at year-end? a.) 9,000,000 b.) 8,000,000 c.) 9,300,000 d.) 9,450,000
4. Entity A acquired 20% interest in Entity B on March 31, 2011 for P500,000. Entity B reports profit of P1M in 20x1, which was earned evenly throughout the period, and declares dividends
On January 1, Year 4, Goodkey Co. acquired all of the common shares of Jingya. The condensed income statements for the two companies for January, Year 5, were as follows: Sales Gain on sale of equipment Other income Depreciation expense Other expenses Income tax expense Net income Goodkey $10,100,000 810,000 10,910,000 460,000 6,610,000 1,983,000 Jingya $ 6,010,000 242,000 51,000 6,303,000 181,000 4,310,000 543,600 9,053,000 5,034,600 $ 1,857,000 $ 1,268,400 The following transactions occurred in January, Year 5, and are properly reflected in the income statements above: • On January 1, Year 5, Jingya sold equipment to Goodkey for $1,010,000 and reported a gain of $242,000. On this date, the equipment had a remaining useful life of four years. • On January 31, Year 5, Jingya paid a dividend of $610,000. Goodkey uses the cost method to account for its investment in Jingya. Both companies pay income tax at the rate of 40%.
Light Inc. had the following activities during the current year: Acquired 4,000 shares of Dark Inc. for P5,200,000 Sold an investment in Lonely Inc. for P7,000,000 when the carrying value was P6,600,000. Acquired a P10,000,000, 4-year certificate of deposit from a bank. During the year, interest of 175,000 was paid to Light Inc. Collected dividends of P240,000 on share dividends. How much is the total cash outflows from investing activities? A. 15,200,000B. 7,000,000C. 6,600,000D. 5,200,000
Light Inc. had the following activities during the current year: Acquired 4,000 shares of Dark Inc. for P5,200,000 Sold an investment in Lonely Inc. for P7,000,000 when the carrying value was P6,600,000. Acquired a P10,000,000, 4-year certificate of deposit from a bank. During the year, interest of 175,000 was paid to Light Inc. Collected dividends of P240,000 on share dividends. What amount should be included as cash inflows from investing activities? A. 5,200,000B. 6,600,000C. 10,000,000D. 7,000,000
2. On January 1, year 1, ABC Company purchased 80% of the stock of XYZ for P4,000,000 cash. Prior to the acquisition, XYZ had 100,000 shares of stock outstanding. On the date of acquisition, XYZ's stock had fair value of P52 per share. During the year, XYZ reported P280,000 in net income and paid dividends of P50,000. What is the balance in the noncontrolling interest account on ABC's balance sheet on December 31, year 1?