Buenaventura, Elijah B.

BSA 3-A

PROBLEM 1

Price paid ₱542,000

Less fair value of net assets acquired 715,000
Income from acquisition (₱173,000)

D&A Schedule
Fair value Parent (100%)
Fair value of subsidiary ₱542,000 ₱542,000
Less book value of interest acquired
Common stock ₱200,000
Retained earnings 470,000
Total equity ₱670,000 ₱670,000
Interest acquired 100%
Book value ₱670,000
Excess (₱128,000) (₱128,000)
Adjustment of identiafiable accounts:
Inventory (140,000 - 130,000) -₱ 10,000
Land (120,000 - 80,000) -40000
Equipment (180,000 - 200,000) 20000
Long-term investment in Securities
(140,000-125,000) -15000
Total (₱45,000)
Income from acquisition (₱173,000)

Common stock ₱200,000

Retained earnings 470,000
Investment in Susan Co. ₱670,000

Inventory ₱10,000
Land 40,000
Long-term investment in Securities 15,000
Investment in Santos Company 128,000
Equipment ₱20,000
Retained earnings - P company (Gain) 173,000
 Perez Company and Santos Company
Consolidation Working Paper
December 8, 2021
Eliminations and
Perez Santos Adjustments
Company Company Debit Credit
Assets
Cash ₱100,000 ₱100,000
Accounts receivable 200,000 150,000
Inventory 150,000 130,000 (2) ₱10,000
Land 50,000 80,000 (2) 40,000
Equipment (net) 300,000 200,000 (2) ₱20,000
Investment in Santos Co. 542,000 - (1) 670,000
(2) 128,000
Long-term Inv. in Securities 100,000 125,000 (2) 15,000
Total ₱1,442,000 ₱785,000

Liabilities and Equity

Accounts payable ₱175,000 ₱115,000
Common stock:
Perez Company 400,000
Santos Company 200,000 (1) 200,000
Additional paid-in capital:
Perez Company 200,000
Retained earnings:
Perez Company 667,000 (2) 173,000
Santos Company 470,000 (1) 470,000

Total ₱1,442,000 ₱785,000 ₱863,000 ₱863,000

PROBLEM 2

Price paid ₱542,000

Non-controlling interest (at fair value) 100,000
Total ₱642,000
Less fair value of net assets acquired 715,000
Income from acquisition (₱73,000)

D&A Schedule
Fair value Parent (80%)
 Fair value Parent (80%)
Fair value of subsidiary ₱642,000 ₱542,000
Less book value of interest acquired
Common stock ₱200,000
Retained earnings 470,000
Total equity ₱670,000 ₱670,000
Interest acquired 80%
Book value ₱536,000
Excess (₱28,000) ₱6,000
Adjustment of identiafiable accounts:
Inventory (140,000 - 130,000) -₱ 10,000
Land (120,000 - 80,000) -40000
Equipment (180,000 - 200,000) 20000
Long-term investment in Securities
(140,000-125,000) -15000
Total (₱45,000)
Income from acquisition (₱73,000)

Common stock ₱200,000

Retained earnings 470,000
Investment in Susan Co. ₱536,000
Non-controlling interest (NCI) 134,000

Inventory ₱10,000
Land 40,000
Long-term investment in Securities 15,000
Non-controlling interest (NCI) 34,000
Equipment ₱20,000
Investment in Susan Co. 6,000
Retained earnings - P company (Gain) 73,000

Perez Company and Santos Company

Consolidation Working Paper
December 8, 2021
Eliminations and
Perez Santos Adjustments
Company Company Debit Credit
Assets
Cash ₱100,000 ₱100,000
Accounts receivable 200,000 150,000
Inventory 150,000 130,000 (2) ₱10,000
Land 50,000 80,000 (2) 40,000
Equipment (net) 300,000 200,000 (2) ₱20,000
Investment in Santos Co. 542,000 - (1) 536,000
(2) 6,000
Long-term Inv. in Securities 100,000 125,000 (2) 15,000
Total ₱1,442,000 ₱785,000

Liabilities and Equity

Accounts payable ₱175,000 ₱115,000
Common stock:
Perez Company 400,000
Santos Company 200,000 (1) 200,000
Additional paid-in capital:
Perez Company 200,000
Retained earnings:
Perez Company 667,000 (2) 73,000
Santos Company 470,000 (1) 470,000

NCI to be consolidated (1) 134,000

(2) 34,000

Total ₱1,442,000 ₱785,000 ₱769,000 ₱769,000

Perez Company and Santos Company

Consolidated Statement of Financial Position
December 8, 2021
Assets
Current Assets
Cash ₱200,000
Accounts receivable 350,000
Inventory 290,000
Total ₱840,000

Non-current assets
Land ₱170,000
Equipment (net) 480,000
Long-term investment in Securities 240,000
Total 890,000
Total assets ₱1,730,000
Liabilities and Equity
Liabilities
Accounts payable ₱290,000

Stockholder's Equity
Common stock ₱400,000
Additional paid-in capital: 200,000
Retained earnings 740,000

Total controlling equity ₱1,340,000

Non-controlling equity 100,000

Total equity 1,440,000

Total liabilities and equity ₱1,730,000
 NCI
-

₱670,000
-
-
-
Consolidated

₱200,000
350,000
290,000
170,000
480,000

240,000
₱1,730,000

₱290,000

400,000

200,000

840,000

₱1,730,000

NCI (20%)
NCI (20%)
100,000

₱670,000
20%
₱134,000
(₱34,000)

Consolidated

₱200,000
350,000
290,000
 170,000
480,000

240,000
₱1,730,000

₱290,000

400,000

200,000

740,000

100,000

₱1,730,000