Problem XV 1 Eliminating entry x9 E1 Buildings and Equipment

# Problem xv 1 eliminating entry x9 e1 buildings and

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Problem XV 1. Eliminating entry, December 31, 20x9: E(1) Buildings and Equipment 156,000 Loss on Sale of Building 36,000 Accumulated Depreciation 120,000 Eliminate unrealized loss on building. 2. Consolidated net income and income to controlling interest for 20x9: Operating income reported by BB P125,000 Net income reported by TT P 15,000 Add: Loss on sale of building 36,000 Realized net income of TT 51,000 Consolidated net income P176,000 Income to non-controlling interest (P51,000 x .30) (15,300 ) Income to controlling interest P160,700 3. Eliminating entry, December 31, 20y0: E(1) Buildings and Equipment 156,000 Depreciation Expense 4,000 Accumulated Depreciation 124,000 Retained Earnings, January 1 25,200 Non-controlling Interest 10,800 Eliminate unrealized loss on building.

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Restated land account P 190,000 P 230,000 P 300,000 3. Final sales price outside the entity minus the original cost to the combined entity equals P102,000 minus P72,000 = P30,000 Problem XVII 1. The gain on the sale of the land in 20x5 was equal to the sales price minus the original cost of the land when it was first acquired by the combined entity. In this case the gain was P150,000 - P90,000, or P60,000. 2. The consolidated amount of depreciation expense was the combined amounts of depreciation expense showing on the separate income statements minus the piecemeal recognition of the gain on the sale of the equipment. Thus, the consolidated amount of depreciation expense was P95,000 + P32,000 – (P35,000/4 years) = P118,250.

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