Assume that the cost of acquisition includes a control premium of P30,000, the non-controlling interest is to be stated at fair value and the retained earnings of ABC Company on December 31, 20x2 is P450,000, determine the amount of consolidated retained earnings to be reported in the consolidated financial statements in 20x2? On January 1, 20x1, ABC Company acquired 80% of XYZ Company's common stock for275,000 cash. At that date, XYZ reported common stock outstanding of 200,000 and retainedeamings of 100,000 and the fair and book value of XYZ's assets and liabilities were equal,except for other intangible assets, which has a fair value 50,000 greater than book value and an8-year remaining life. XYZ reported the following data for 20x1 and 20x2.YearNet IncomeDividends PaidComprehensiveIncome5,00010,00020x125,00035,00030,00045,00020x2Bright reported separate net income from own operations of 100,000 and paid dividends of30,000 for both years.

Retained earnings refer to the earnings earned by the parent company and the part of the earnings of…

Assume that the cost of acquisition includes a control premium of P30,000, the non-controlling interest is to be stated at fair value and the retained earnings of ABC Company on December 31, 20x2 is P450,000, determine the amount of consolidated retained earnings to be reported in the consolidated financial statements in 20x2?

Assume that the cost of acquisition includes a control premium of P30,000, the non-controlling interest is to be stated at fair value and the retained earnings of ABC Company on December 31, 20x2 is P450,000, determine the amount of consolidated retained earnings to be reported in the consolidated financial statements in 20x2?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 8MC

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