Ping Ltd. and its affiliates consolidated financial statement reported goodwill of $40,000 under the entity theory on
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Question:
Ping Ltd. and its affiliate’s consolidated financial statement reported goodwill of $40,000 under the entity theory on December 31, 2014, after it acquired an 80 percent interest in Singh Ltd. for $280,000. There exists a difference in the fair value and the book value of net assets at the purchase date due to undervalued plant assets of $50,000 with a five-year remaining useful life. Separate income for Ping and Singh were $200,000 and $50,000, respectively.
Required
1. Calculate goodwill if Ping decided to use the parent-company theory.
2. Calculate consolidated net income and noncontrolling interest share under both theories.
Related Book For
Advanced Accounting
ISBN: 9780132568968
11th Edition
Authors: Floyd A. Beams, Joseph H. Anthony, Bruce Bettinghaus, Kenneth Smith
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