20x4 90000 Amortization of allocated excess refer to amortization above 20x4 P

20x4 90000 amortization of allocated excess refer to

This preview shows page 93 - 97 out of 195 pages.

20x4) 90,000 Amortization of allocated excess (refer to amortization above) : 20x4 P 13,20 0 20x5 7, 200 ( 20,4 00) Fair value of stockholders’ equity of S, December 31, 20x5…… P 495,60 0 Multiplied by: Non-controlling Interest percentage…………... 20 Non-controlling interest (partial goodwill) ………………………………….. P 99,120 Add: Non-controlling interest on full goodwill , net of impairment loss [(P15,000 full – P12,000, partial = P3,000) – P750 impairment loss 2,2 50 Non-controlling interest (full-goodwill) ………………………………….. P 101,37 0 f. Consolidated SHE: Stockholders’ Equity Common stock, P10 par P 600,000 Retained earnings 676,680 P’s Stockholders’ Equity / CI – SHE, 12/31/20x4 P1,276, 680 NCI, 12/31/20x4 __101,3 70
Image of page 93

Subscribe to view the full document.

Consolidated SHE, 12/31/20x4 P1,378, 050 Problem XV – 80% Partial Goodwill – Equity Method Requirements 1 to 4: Schedule of Determination and Allocation of Excess (Partial-goodwill) Date of Acquisition – January 1, 20x4 Fair value of Subsidiary (80%) Consideration transferred…………………………… ….. P 372,000 Less: Book value of stockholders’ equity of S: Common stock (P240,000 x 80%)……………………. P192,000 Retained earnings (P120,000 x 80%)………………... 96,000 288,000 Allocated excess (excess of cost over book value)….. P 84,000 Less: Over/under valuation of assets and liabilities: Increase in inventory (P6,000 x 80%)……………… P 4,800 Increase in land (P7,200 x 80%) ……………………. 5,760 Increase in equipment (P96,000 x 80%) 76,800 Decrease in buildings (P24,000 x 80%)……… ..... ( 19,200) Decrease in bonds payable (P4,800 x 80%)…… 3,840 72,000 Positive excess: Partial-goodwill (excess of cost over fair value) ……………………………………… ………... P 12,000
Image of page 94
The over/under valuation of assets and liabilities are summarized as follows: S Co. Book value S Co. Fair value (Over) Under Valuation Inventory……………… ….…………….. P 24,000 P 30,000 P 6,000 Land…………………… ………………… 48,000 55,200 7,200 Equipment (net) ......... 84,000 180,000 96,000 Buildings (net) 168,000 144,000 (24,000) Bonds payable………………… ……… (120,000) ( 115,200 ) 4,800 Net……………………… ……………….. P 204,000 P 294,000 P 90,000 The buildings and equipment will be further analyzed for consolidation purposes as follows: S Co. Book value S Co. Fair value Increase (Decrease) Equipment .................. 180,000 180,000 0 Less: Accumulated depreciation….. 96,000 - ( 96,000) Net book value…………………… …... 84,000 180,000 96,000 S Co. Book value S Co. Fair value (Decrease) Buildings ................ 360,000 144,000 ( 216,000) Less: Accumulated depreciation….. 192,000 - ( 192,000) Net book value…………………… …... 168,000 144,000 ( 24,000) A summary or depreciation and amortization adjustments is as follows: Account Adjustments to be Over/ Li Annu Current 20x5
Image of page 95

Subscribe to view the full document.

amortized Unde r fe al Amou nt Year(20 x4) Inventory P 6,000 1 P 6,000 P 6,000 P - Subject to Annual Amortization Equipment (net) ......... 96,00 0 8 12,00 0 12,000 12,00 0 Buildings (net) (24,0 00) 4 ( 6,00 0) ( 6,000) (6,00 0) Bonds payable… 4,8 00 4 1,2 00 1,20 0 1,2 00 P 13,20 0 P 13,200 P 7,200 The goodwill impairment loss of P3,125 based on 100% fair value would be allocated to the controlling interest and the NCI based on the percentage of total goodwill each equity interest received. For purposes of allocating the goodwill impairment loss, the full-goodwill is computed as follows: Fair value of Subsidiary (100%)
Image of page 96
Image of page 97
  • Spring '16

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Ask Expert Tutors You can ask You can ask ( soon) You can ask (will expire )
Answers in as fast as 15 minutes