in A net identifiable assets. XYZ's assets and liabilities on January 1, 2021 approximate their fair values except for the following: Carrying Fair Fair value XYZ, Inc. values adjustments (FVA) amounts 23,000 Inventory Equipment (4 yrs. remaining life) Accumulated depreciation Totals 31,000 8,000 50,000 60,000 (10,000) (12,000) 63,000 10,000 79,000 (2,000) 16,000 XYZ, Inc. declared and paid dividends of P10,000 during 2021. There was no impairment in goodwill. The year-end individual statements of profit or loss are shown below: Statements of profit or loss For the year ended December 31, 2021 АВС Со. XYZ, Inc. Sales 300,000 120,000
in A net identifiable assets. XYZ's assets and liabilities on January 1, 2021 approximate their fair values except for the following: Carrying Fair Fair value XYZ, Inc. values adjustments (FVA) amounts 23,000 Inventory Equipment (4 yrs. remaining life) Accumulated depreciation Totals 31,000 8,000 50,000 60,000 (10,000) (12,000) 63,000 10,000 79,000 (2,000) 16,000 XYZ, Inc. declared and paid dividends of P10,000 during 2021. There was no impairment in goodwill. The year-end individual statements of profit or loss are shown below: Statements of profit or loss For the year ended December 31, 2021 АВС Со. XYZ, Inc. Sales 300,000 120,000
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 14RE
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100%
![On January 1, 2021, ABC Co. acquired 80% interest in XYZ, Inc. by issuing 5,000 shares with fair value of P15 per share. On this date,
XYZ's equity comprised of P50,000 share capital and P24,000 retained earnings. NCI was measured at its proportionate share in XYZ's
net identifiable assets.
XYZ's assets and liabilities on January 1, 2021 approximate their fair values except for the following:
Carrying
атоunts
Fair
Fair value
XYZ, Inc.
values adjustments (FVA)
Inventory
Equipment (4 yrs. remaining
life)
23,000
31,000
8,000
10,000
60,000
(10,000) (12,000)
63,000
50,000
Accumulated depreciation
Totals
(2,000)
16,000
79,000
XYZ, Inc. declared and paid dividends of P10,000 during 2021. There was no impairment in goodwill. The year-end individual
statements of profit or loss are shown below:
Statements of profit or loss
For the year ended December 31, 2021
АВС Со.
XYZ, Inc.
Sales
300,000
120,000
Cost of goods sold
Gross profit
Depreciation expense
(165,000)
135,000
(40,000)
(32,000)
(3,000)
(72,000)
48,000
(10,000)
(18,000)
Distribution costs
Interest expense
Dividend income
8,000
68,000
20,000
Profit for the year
How much is the consolidated profit to be reported on December 31,2021?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff6f01cda-894e-48e2-9acb-d1af9082aaa5%2F72228128-adcd-461a-8c3f-a6b8b352a8ad%2Fxo8z3ba_processed.jpeg&w=3840&q=75)
Transcribed Image Text:On January 1, 2021, ABC Co. acquired 80% interest in XYZ, Inc. by issuing 5,000 shares with fair value of P15 per share. On this date,
XYZ's equity comprised of P50,000 share capital and P24,000 retained earnings. NCI was measured at its proportionate share in XYZ's
net identifiable assets.
XYZ's assets and liabilities on January 1, 2021 approximate their fair values except for the following:
Carrying
атоunts
Fair
Fair value
XYZ, Inc.
values adjustments (FVA)
Inventory
Equipment (4 yrs. remaining
life)
23,000
31,000
8,000
10,000
60,000
(10,000) (12,000)
63,000
50,000
Accumulated depreciation
Totals
(2,000)
16,000
79,000
XYZ, Inc. declared and paid dividends of P10,000 during 2021. There was no impairment in goodwill. The year-end individual
statements of profit or loss are shown below:
Statements of profit or loss
For the year ended December 31, 2021
АВС Со.
XYZ, Inc.
Sales
300,000
120,000
Cost of goods sold
Gross profit
Depreciation expense
(165,000)
135,000
(40,000)
(32,000)
(3,000)
(72,000)
48,000
(10,000)
(18,000)
Distribution costs
Interest expense
Dividend income
8,000
68,000
20,000
Profit for the year
How much is the consolidated profit to be reported on December 31,2021?
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