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    Advanced Accounting - 2015 (Chapter 17) Multiple Choice Solution (Part L)

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    John Carlos Doringo
    The document provides consolidated financial information for companies P and S for the year 20x5. It shows that P's net income from separate operations was $450,000 and S's was $236,250. It then calculates total consolidated net income of $686,250 and consolidated net income attributable to the parent company (after subtracting NCI) of $615,375. It provides an alternative calculation that first subtracts the NCI of $70,875 from consolidated net income to arrive at the same net income attributable to the parent company of $615,375.

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    Advanced Accounting - 2015 (Chapter 17) Multiple Choice Solution (Part L)

    Uploaded by

    John Carlos Doringo
    35 views2 pages
    The document provides consolidated financial information for companies P and S for the year 20x5. It shows that P's net income from separate operations was $450,000 and S's was $236,250. It then calculates total consolidated net income of $686,250 and consolidated net income attributable to the parent company (after subtracting NCI) of $615,375. It provides an alternative calculation that first subtracts the NCI of $70,875 from consolidated net income to arrive at the same net income attributable to the parent company of $615,375.

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    Advanced Accounting - 2015 [Chapter 17] Multiple Choice Solution (Part L)

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    The document provides consolidated financial information for companies P and S for the year 20x5. It shows that P's net income from separate operations was $450,000 and S's was $236,250. It then calculates total consolidated net income of $686,250 and consolidated net income attributable to the parent company (after subtracting NCI) of $615,375. It provides an alternative calculation that first subtracts the NCI of $70,875 from consolidated net income to arrive at the same net income attributable to the parent company of $615,375.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    35 views2 pages

    Advanced Accounting - 2015 (Chapter 17) Multiple Choice Solution (Part L)

    Uploaded by

    John Carlos Doringo
    The document provides consolidated financial information for companies P and S for the year 20x5. It shows that P's net income from separate operations was $450,000 and S's was $236,250. It then calculates total consolidated net income of $686,250 and consolidated net income attributable to the parent company (after subtracting NCI) of $615,375. It provides an alternative calculation that first subtracts the NCI of $70,875 from consolidated net income to arrive at the same net income attributable to the parent company of $615,375.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    of 2

    Chapter 17

    Multiple Choice Problems


    69. d
    Consolidated Net Income for 20x5
    P Company’s net income from own/separate operations P 450,000
    Realized profit in beginning inventory of S Company (downstream sales) 0
    Unrealized profit in ending inventory of S Company (downstream sales)… (_0)
    P Company’s realized net income from separate operations*…….….. P450,000
    S Company’s net income from own operations P240,000
    Realized profit in beginning inventory of P Company (upstream sales)
    [P157,500 x 20/120) 26,250
    Unrealized profit in ending inventory of P Company (upstream sales)
    [P180,000 x 20/120) ( 30,000 )
    S Company’s realized net income from separate operations*…….….. P236,250 236,250
    Total P 686,250
    Less: Amortization of allocated excess…………………… _0
    Consolidated Net Income for 20x4 P686,750
    Less: Non-controlling Interest in Net Income* * 70,875
    Controlling Interest in Consolidated Net Income or Profit attributable to
    equity holders of parent – 20x5………….. P 615,375
    *that has been realized in transactions with third parties.
    Or, alternatively
    Consolidated Net Income for 20x5
    P Company’s net income from own/separate operations P 450,000
    Realized profit in beginning inventory of S Company (downstream sales) 0
    Unrealized profit in ending inventory of S Company (downstream sales)… (_0)
    P Company’s realized net income from separate operations*…….….. P450,000
    S Company’s net income from own operations P240,000
    Realized profit in beginning inventory of P Company (upstream sales)
    [P157,500 x 20/120) 26,250
    Unrealized profit in ending inventory of P Company (upstream sales)
    [P180,000 x 20/120) ( 30,000 )
    S Company’s realized net income from separate operations*…….….. P236,250 236,250
    Total P 686,250
    Less: Non-controlling Interest in Net Income* * P 70,875
    Amortization of allocated excess…………………… 0 70,875
    Controlling Interest in Consolidated Net Income or Profit attributable to
    equity holders of parent………….. P 615,375
    Add: Non-controlling Interest in Net Income (NCINI) __70,875
    Consolidated Net Income for 20x5 P 686,250
    *that has been realized in transactions with third parties.

    **Non-controlling Interest in Net Income (NCINI) for 20x4


    S Company’s net income of Subsidiary Company from its own operations
    (Reported net income of S Company) P 240,000
    Realized profit in beginning inventory of P Company (upstream sales) 26,250
    Unrealized profit in ending inventory of P Company (upstream sales) ( 30,000)
    S Company’s realized net income from separate operations……… P 236,250
    Less: Amortization of allocated excess 0
    P 236,250
    Multiplied by: Non-controlling interest %.......... 30%
    Non-controlling Interest in Net Income (NCINI) – partial goodwill P 70.875
    Less: NCI on goodwill impairment loss on full goodwill 0
    Non-controlling Interest in Net Income (NCINI) – full goodwill P 70,875

    70. a – refer to No. 69 for computation.


    71. d
    Sales
    P Company 420,000
    S Company 280,000
    Total 700,000
    Less: Intercompany sales 140,000
    Consolidated 560,000
    72. b
    Operating
    Expenses
    P Company 28,000
    S Company 14,000
    Total 42,000
    Add: Undervalued equipment (P35,000/7 years) _5,000
    Consolidated 47,000

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