On January 1, 2022, JPIA Corporation has a subsidiary in Hong Kong. The subsidiary's December 31, 2022
Question:
On January 1, 2022, JPIA Corporation has a subsidiary in Hong Kong. The subsidiary's December 31, 2022 Trial Balance, in Hong Kong Dollar (HK$), is as follows:
DEBIT | CREDIT | |
Cash | 18,000 | |
Accounts receivable (net) | 30,000 | |
Inventory | 37,500 | |
Plant & equipment | 150,000 | |
Accumulated Depreciation | 15,000 | |
Accounts payable | 18,000 | |
Bonds payable | 75,000 | |
Ordinary Share | 90,000 | |
Sales | 225,000 | |
Cost of Sales | 105,000 | |
Depreciation expenses | 15,000 | |
Operating expenses | 45,000 | |
Dividends paid | 22,500 | |
423,000 | 423,000 |
Additional Information:
Purchases of inventory goods were made evenly during the year. The dividends were declared and paid on November 1. The ordinary shares were issued on January 1, 2022. The functional currency of the subsidiary is the Hong Kong dollar. Exchange rates were as follows:
HK$ | PHP | |
January 1 | 1.00 | 5.30 |
March 1 | 1.00 | 5.40 |
November 1 | 1.00 | 5.50 |
December 31 | 1.00 | 5.00 |
Average rate - 2022 | 1.00 | 5.40 |
Cumulative translation adjustment loss (debit) is:
52. On January 1, 2020, Julius Company acquired 40% interest in Ella Company for P4,800,000. Julius already had 25% interest which had been acquired for P1,600,000. The fair value of the identifiable net assets of Ella Co. was P8,800,000.
How much is the goodwill recognized by Julius as a result of business combination?
On January 07, 2022, Ian Co., acquired 35% interest in Mark Co., for P4,300,000. Ian already held a 20% interest which had been acquired for P1,600,000 which was valued at P1,800,000 at January 07, 2022. The fair value of the identifiable net assets of Mark Co., was P8,400,000. The fair value of NCI is P4,050,000.
How much goodwill is to be recorded on the separate books of Ian Co.?
Accounting Principles
ISBN: 9781119707110
14th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Jill E. Mitchell