RULONA, KERBY GAIL P.

BSA-3A
PROBLEM 6
1. B
Consideration Transferred
NCI in the acquiree
Previously held interest in the acquiree
Total
FV of Net Identifiable Assets acquired
Goodwill

Other Assets
Investment in subsidiary
Goodwill
Total Assets

2. B
3. B

Consideration Transferred
NCI in the acquiree (400,000 x 20%)
Previously held interest in the acquiree
Total
FV of Net-Identifiable Assets acquired
Goodwill

FV of Identifiable Assets acquired (750,000+50,000)

FV of Liabilities Assumed
FV of Net-Identifiable Assets Acquired

Owners of the Parent

Ordinary Share Capitall 1,000,000
Retained Earnings 250,000
Non-controlling Interest
Total 1,250,000

4. D Jan. 1
CV of Net-Identifiable Assets 296,000
FV of Assets (32,0000 +32,000) 64,000
FV of Net- Identifiable Assets 360,000

Inventory 32,000
Building (192,000-160000)/4 8,000
Total Depreciation in FVA 40,000

5. A
Consideration transferred
NCI in the acquiree (360,000 x 20%)
Previously held interest in the acquiree
Total
Less:FV of net identifiable assets acquired
Goodwill

6. D
The goodwill attributable to NCI is 0 since the NCI is measured using proportionate share method.

7. C
Square Co.
Cash 392,000
Inventory 420,000
Inventory in subsidiary 300,000
Equipment, net 560,000
Goodwill
Total Assets

8. B
FV of Net Identifiable Assets 400,000
NCI rate 20%
NCI in Net Assets - Dec 31,20x1 80,000

9. C
Retained Earnings-Square Co. 440,000
Add:Net change(40,000*80%) 32,000
Consolidated Retained Earnings-Dec 31,20x1 472,000
10. C Square Co.
Share capital 940,000
Retained earnings 440,000
Add: Net change in adjustments 32,000
NCI
1,412,000

11. C
Square Co. Profit 600,000
Circle Co. Profit 80,000
Less: Depreciation of FVA (40,000)
Consolidated Profit in 20x1 640,000

12. B
Square Co. (80%)
Square Co. Profit or Loss 600,000
Allocation of Circle Co before FVA 64,000
Less: Depreciation of FVA (32,000)
Allocated Consolidation Profit or Loss 632,000

13 - 20.
Jan. 1
CV of NIA - Pirated Co. 348,000
Fair Value Adjustments (38,000)
FV of NIA - Pirated Co. 310,000

FVA 1/1/20x1
Inventory (48,000)
Building 10,000
Total Depreciation in FVA (38,000)

Consideration Transferred 360,000

Previously held interest in the acquiree 0
Total 360,000
FV NIA Attributable to Parent 186,000
Goodwill-Parent 174,000

NCI Fair Value 240,000

NCI Share in Net Assets 124,000
Goodwill-NCI 116,000
Total Goodwill 290,000

Original Co.
Total Assets 1,190,000
Goodwill
Total Assets

FV of Net Identifiable Assets 426,750

NCI rate 40%
NCI in Net Assets - Dec 31 170,700
Add: Goodwill NCI 116,000
Total NCI-Dec. 31 286,700

Owner's of the Parent

Share Capital 1,200,000
Retained Earnings 386,050
Non-controlling Interest
Total 1,586,050
16.

Income Statement
Sales 700,000
Cost of Sales (200,000)
Gross Profit 500,000
Other Operating Expenses (400,000)
Profit for the Year 100,000

Original Co.(60%)
Original Co.'s P/L 100,000
Allocation of Pitraited Co's NI before FV 42,000
Depreciation of FVA 28,050
Allocated Consolidation P/L 170,050
20.

13. B
14. C
15. A
16. A
17. B
18. A
19. A
20. D
13-20.
 360,000
240,000
0
600,000
(310,000)
290,000

Jeep Co. Taxi Co. Consolidated

1,296,000 406,000 1,702,000
360,000 -
290,000 290,000
1,992,000

Investment in subsidiary
430,000 Other Assets
80,000 Goodwill
0 Assets
510,000
(400,000) Liabilities
110,000 Ordinary share capital
Retained Earnings
800,000 Non-controlling Interest
(400,000) Total Liabilities& Equity
400,000

Non-controlling Interest

80,000
80,000

Dec.31 Net change

376,000
24,000
 400,000 40,000

24,000

300,000
72,000
-
372,000
360,000
12,000

d using proportionate share method.

Circle Co. Consolidated

316,000 708,000
60,000 480,000
-
144,000 704,000
12,000 12,000
1,904,000
Circle Co. Consolidated
200,000 940,000
176,000 472,000

80,000 80,000
80,000 1,492,000

Circle Co. (20%) Consolidated

0
16,000
(8,000)
8,000 640,000

Dec. 31 Net Change

418,000
8,750
426,750 116,750

Useful Life Subsequent Depreciation FVA 12/31/20x1

- 48,000
8 1,250 8,750
46,750

13.
 Pirated Co. Consolidated
558,750 1,748,750
290,000 290,000
2,038,750 14.

15..

Non-controlling Interest

286,700
286,700

Consolidated Income Statement

350,000 1,050,000
(80,000) (48,000) (232,000)
270,000 818,000
(200,000) (1,250) (601,250)
70,000 216,750

NCI(40%) Total
0
28,000
18,700
46,700 216,750
19.
String Co. Wind Co. Consolidated
430,000 -
1,570,000 800,000 2,370,000
110000 110,000
2,480,000

750,000 400,000 1,150,000

1,000,000 310,000 1,000,000
250,000 40,000 250,000
80,000 80,000
2,480,000
17.

18.