15 Feb On January 1, 20×6 Dann Corporation purchased 75% of the common stock of Lann Corporation. Separate balance sheet data for the companies at the combination data are given below:
On January 1, 20×6 Dann Corporation purchased 75% of the common stock of Lann Corporation. Separate balance sheet data for the companies at the combination data are given below:
Dann Lann
Cash P 12,000 P103,000
Accounts receivable 72,000 13,000
Inventory 66,000 19,000
Land 39,000 16,000
Plant assets 350,000 150,000
Accumulated depreciation (120,000) ( 30,000)
Investment in Lann 196,000 ? ?
Total assets P615,000 P271,000
Accounts payable P103,000 P 71,000
Capital stock 400,000 150,000
Retained earnings 112,000 50,000
Total equities P615,000 P271,000
At the date of the combination the book values of Lann’s net assets was equal to the fair value of the net assets except for Lann’s inventory which has a fair value of P30,000. Fair value of noncontrolling interest is P60,000. Indicate in each of the question what the consolidated balance would be for the requested account:
What amount of inventory will be reported?
a. P85,000
b. P19,000
c. P96,000
d. P93,250
What amount of goodwill will be reported?
a. P50,333
b. P21,000
c. P37,750
d. P45,000
What amount of total liabilities will be reported?
a. P174,000
b. P 90,000
c. P284,000
d. P213,000
What is the reported amount of the minority interest?
a. P 60,000
b. P 15,000
c. P 52,750
d. P 65,333
What is the amount of consolidated retained earnings?
a. P112,000
b. P142,000
c. P100,000
d. P302,000
What is the amount of the total assets?
a. P738,750
b. P751,333
c. P686,000
d. P746,000
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