27) Echo Corporation purchased 25 percent of Foxtrot Company's stock on January 1, 20x7 for P600,000....
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27) Echo Corporation purchased 25 percent of Foxtrot Company's stock on January 1, 20x7 for P600,000. At the acquisition date, Foxtrot has equipment with market value of P250,000 greater than the book value. On that date, Echo Corporation gives the ability to have joint control with another entity over Foxtrot Company's. the equipment has an estimated remaining life of 10 years. In 20x7, Foxtrot has net income of P320,000 and pays P80,000 of dividends. Assuming that the investor (joint venture) does not prepare consolidated financial statements, the investment account in Echo's financial records at the end of 20x7 is: a. P600,000 b. P673,750 c. P660,900 d. P653,750 27) Echo Corporation purchased 25 percent of Foxtrot Company's stock on January 1, 20x7 for P600,000. At the acquisition date, Foxtrot has equipment with market value of P250,000 greater than the book value. On that date, Echo Corporation gives the ability to have joint control with another entity over Foxtrot Company's. the equipment has an estimated remaining life of 10 years. In 20x7, Foxtrot has net income of P320,000 and pays P80,000 of dividends. Assuming that the investor (joint venture) does not prepare consolidated financial statements, the investment account in Echo's financial records at the end of 20x7 is: a. P600,000 b. P673,750 c. P660,900 d. P653,750
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Fundamentals of Advanced Accounting
ISBN: 978-0077862237
6th edition
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik
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