Ba 118.2 Q16 Business Com_subsequent.docx

BA 118 Q16 Business Combination_Cost_adeveyra On January 1, 2014, P Company acquired 80% of the outstanding common stocks of S Company. As of this date, the Inventory, Equipment (5 years remaining life), Building (10 years remaining life) and Land of S Company had market values ₱20,000, ₱50,000, ₱85,000 and ₱500,000 above book value, respectively. NCI acquisition cost is ₱150,000 above the share of the non-controlling interest on the market value of the net assets of the acquiree on the date of combination. P uses the cost method. You were given the following:

Sales Cost of sales Expenses Dividend income Net income Dividends paid

2014 P S 4,250,000 2,225,000 1,575,000 975,000 825,000 550,000 125,000 80,000 1,975,000 780,000

2015 P S 7,825,000 3,285,000 2,100,000 1,572,000 1,250,000 915,000 115,000 48,000 4,590,000 846,000

250,000

75,000

550,000

120,000

Cash AR Inventory Investment in S Equipment Building Land

518,500 215,000 578,500 3,350,000 2,160,000 3,490,000 1,825,000 12,137,000

285,000 92,000 335,000

325,000 195,000 506,000

1,250,000 1,530,000 900,000 4,392,000

1,845,000 415,000 1,280,000 3,350,000 3,850,000 3,250,000 2,125,000 16,115,000

1,888,000 1,625,000 925,000 5,464,000

NP AP Share capital APIC Retained earnings

425,000 412,000 5,250,000 1,250,000 4,800,000 12,137,000

112,000 225,000 2,500,000 425,000 1,130,000 4,392,000

225,000 550,000 5,250,000 1,250,000 8,840,000 16,115,000

373,000 310,000 2,500,000 425,000 1,856,000 5,464,000

Prepare the relevant eliminating entries as of Dec 31, 2014 and 2015. Compute for consolidated sales, cost of sales & expenses for 2014 & 2015. Compute for consolidated net income for 2014 and 2015. Compute for income attributable to the parent for 2014 and 2015. Compute for non-controlling interest in net income of the subsidiary for 2014 and 2015. Compute for non-controlling interest in the net assets of the subsidiary as of end of 2014 and 2015. Compute for consolidated total assets as of end of 2014 and 2015. Compute for consolidated retained earnings as of Dec 31, 2014 and 2015.

BA 118 Q19 Business Combination_Cost_adeveyra On January 1, 2014, P Company acquired 80% of the outstanding common stocks of S Company. As of this date, the Inventory, Equipment (5 years remaining life), Building (10 years remaining life) and Land of S Company had market values ₱20,000, ₱50,000, ₱85,000 and ₱500,000 above book value, respectively. NCI acquisition cost is ₱150,000 above the share of the non-controlling interest on the market value of the net assets of the acquiree on the date of combination. P uses the cost method. You were given the following:

Sales Cost of sales Expenses Dividend income Net income Dividends paid

2014 P S 4,250,000 2,225,000 1,575,000 975,000 825,000 550,000 125,000 80,000 1,975,000 780,000

2015 P S 7,825,000 3,285,000 2,100,000 1,572,000 1,250,000 915,000 115,000 48,000 4,590,000 846,000

250,000

75,000

550,000

120,000

Cash AR Inventory Investment in S Equipment Building Land

518,500 215,000 578,500 3,350,000 2,160,000 3,490,000 1,825,000 12,137,000

285,000 92,000 335,000

325,000 195,000 506,000

1,250,000 1,530,000 900,000 4,392,000

1,845,000 415,000 1,280,000 3,350,000 3,850,000 3,250,000 2,125,000 16,115,000

1,888,000 1,625,000 925,000 5,464,000

NP AP Share capital APIC Retained earnings

425,000 412,000 5,250,000 1,250,000 4,800,000 12,137,000

112,000 225,000 2,500,000 425,000 1,130,000 4,392,000

225,000 550,000 5,250,000 1,250,000 8,840,000 16,115,000

373,000 310,000 2,500,000 425,000 1,856,000 5,464,000

Prepare the relevant eliminating entries as of Dec 31, 2014 and 2015. Compute for consolidated sales, cost of sales & expenses for 2014 & 2015. Compute for consolidated net income for 2014 and 2015. Compute for income attributable to the parent for 2014 and 2015. Compute for non-controlling interest in net income of the subsidiary for 2014 and 2015. Compute for non-controlling interest in the net assets of the subsidiary as of end of 2014 and 2015. Compute for consolidated total assets as of end of 2014 and 2015. Compute for consolidated retained earnings as of Dec 31, 2014 and 2015.