Asssume that on January 2, 2020, PT.

Ortu Purchases 80% of the common stock of

PT Bocah for its than book value of Rp 150.000.000.

Figure 3.2
PT Ortu and PT Bocah
Financial Statement, January 2, 2020
PT Ortu PT Bocah
Comprehensive Income Rp Rp
Sales 500,000,000 200,000,000
Cost of Goods Sold (350,000,000) (145,000,000)
Operating expense (75,000,000) (15,000,000)
Net Income 75,000,000 40,000,000
Retained Earnings
Retained Earnings January, 1 45,000,000 20,000,000
Net Income 75,000,000 40,000,000
120,000,000 60,000,000
Devidends Declared 35,000,000 25,000,000
Retained Earnings December, 31 85,000,000 35,000,000
Financial Posistion
Cash 165,000,000 85,000,000
Account Receivable 60,000,000 50,000,000
Inventory 80,000,000 30,000,000
Land, Buildings, and Equipment 100,000,000 70,000,000
Total Asset 405,000,000 235,000,000

Account Payable 100,000,000 70,000,000

Common Stock 200,000,000 120,000,000
Additional Paid-In Capital 20,000,000 10,000,000
Retained earnings 85,000,000 35,000,000
Total Liabilities and Equities 405,000,000 235,000,000

a. Goodwill at the date of acquisition

Investment Cost 150,000,000
Book value (PT Bocah)
Common Stock 120,000,000
Additional Paid-In Capital 10,000,000
Retained earnings 20,000,000
Total equities 150,000,000
PT Ortu's share 80% 120,000,000
Goodwill 30,000,000

Goodwill amortisation year 6,000,000 /year amortisasi goodwill itu 5 tahun

b. Consolidated net income
Seprate operating income of PT Ortu 75,000,000
Income from Subsidiary = 80% x Net
income Comprehensive Income PT 32,000,000
Bocah
Goodwill amortisation per years 6,000,000
Income from Subsidiary = 80% x Net in 26,000,000
Consolidated net income 101,000,000

c. PT Ortu Records Transaction

Investment in PT Bocah Stock 150,000,000 156,000,000
Cash 150,000,000
Record purchase of PT Bocah Stock
Investment in PT Bocah Stock 26,000,000
Income for subsidiary 26,000,000
Record income from subsidiary
Cash 20,000,000
Investment in PT Bocah Stock 20,000,000
Record Dividends from subsidiary

d. The following elimination entry is needed in the cosolidation workpaper

Item Debit Credit
Common Stock 120,000,000
Add Paid In Capital 10,000,000
Retained earnings, January 2 20,000,000
Investment in PT Bocah stock 120,000,000
Noncontrolling Interest 30,000,000
Eliminate beginning investment balance
Income from subsidiary 26,000,000
Dividends declared 20,000,000
Investment in PT Bocah stock 6,000,000
Eliminate Income from subsidiary
Income to Noncontrolling Interest 8,000,000
Dividends Declared 5,000,000
Noncontrolling Interest 3,000,000
Eliminate to assign income to noncontrolling interest
Goodwill 30,000,000
Investment in subsidiary to goodwill 30,000,000
Eliminated Investment in subsidiary to goodwill
Goodwill amortisation 6,000,000
Goodwill 6,000,000
Eliminated goodwill to Goodwill amortisation
 PT Ortu and PT Bocah
Financial Statement, December 31, 2020 (Adjusted)
PT Ortu PT Bocah
Comprehensive Income Rp Rp
Sales 500,000,000 200,000,000
Cost of Goods Sold (350,000,000) (145,000,000)
Operating expense (75,000,000) (15,000,000)
Net Income 75,000,000 40,000,000
Income from subsidiary 26,000,000
Cosnsolidated net income 101,000,000 40,000,000
Retained Earnings
Retained Earnings January, 1 45,000,000 20,000,000
Cosnsolidated net income 101,000,000 40,000,000
146,000,000 60,000,000
Devidends Declared 35,000,000 25,000,000
Retained Earnings December, 31 111,000,000 35,000,000
Financial Posistion
Investmnet in PT Bocah Stock 156,000,000
Cash 35,000,000 85,000,000
Account Receivable 60,000,000 50,000,000
Inventory 80,000,000 30,000,000
Land, Buildings, and Equipment 100,000,000 70,000,000
Total Asset 431,000,000 235,000,000

Account Payable 100,000,000 70,000,000

Common Stock 200,000,000 120,000,000
Additional Paid-In Capital 20,000,000 10,000,000
Retained earnings 111,000,000 35,000,000
Total Liabilities and Equities 431,000,000 235,000,000

Workpaper for Consolidated Financial Statement

PT Ortu PT Bocah Elimination

Comprehensive Income Rp Rp Debit
Sales 500,000,000 200,000,000
Cost of Goods Sold (350,000,000) (145,000,000)
Operating expense (75,000,000) (15,000,000)
Net Income 75,000,000 40,000,000
Income from subsidiary 26,000,000 26,000,000
Income noncontrolling interest 8,000,000
Goodwill amortisation 6,000,000
Cosnsolidated net income 101,000,000 40,000,000
Retained Earnings
Retained Earnings January, 1 45,000,000 20,000,000
Net Income 101,000,000 40,000,000
146,000,000 60,000,000
Devidends Declared 35,000,000 25,000,000

Retained Earnings December, 31 111,000,000 35,000,000

Financial Posistion

Investmnet in PT Bocah Stock 156,000,000

Cash 35,000,000 85,000,000

Account Receivable 60,000,000 50,000,000
Inventory 80,000,000 30,000,000
Land, Buildings, and Equipment 100,000,000 70,000,000
Goodwill 30,000,000
Total Asset 431,000,000 235,000,000
Account Payable 100,000,000 70,000,000
Common Stock 200,000,000 120,000,000 120,000,000
Additional Paid-In Capital 20,000,000 10,000,000 10,000,000
Retained earnings 12/31 111,000,000 35,000,000 20,000,000
Non-controlling interest

Total Liabilities and Equities 431,000,000 235,000,000

PT Ortu and Subsidiary

Consolidareted Financial Statement
Year ending, December 31, 2020
Comprehensive Income Rp Rp
Sales 700,000,000
Cost of Goods Sold (495,000,000)
Operating expense (90,000,000)
Goodwill amortisation (6,000,000)
Net Income 109,000,000
Non-controlling interest (8,000,000)
Cosnsolidated net income 101,000,000

Retained Earnings
Retained Earnings January, 1 45,000,000
Cosnsolidated net income 101,000,000
146,000,000
Devidends Declared (35,000,000)
Retained Earnings December, 31 111,000,000

Financial Posistion
Cash 120,000,000
Account Receivable 110,000,000
Inventory 110,000,000
Land, Buildings, and Equipment 170,000,000
Goodwill 24,000,000
Total Asset 534,000,000
Account Payable 170,000,000
Non-controlling interest
Common Stock
Additional Paid-In Capital
Retained earnings 12/31
Total Non-controlling interest 33,000,000
Controlling Interest
Common Stock 200,000,000
Additional Paid-In Capital 20,000,000
Retained earnings 12/31 111,000,000
Total Controlling Interest 331,000,000
Total Liabilities and Equities 534,000,000
ortisasi goodwill itu 5 tahun
ement

Elimination Consolidation
Kredit Rp
700,000,000
(495,000,000)
(90,000,000)
115,000,000

(8,000,000)
(6,000,000)
101,000,000 same as pt ortu
 45,000,000
101,000,000
146,000,000
20,000,000
35,000,000
5,000,000
111,000,000

120,000,000
6,000,000
30,000,000
120,000,000
110,000,000
110,000,000
170,000,000
6,000,000 24,000,000
534,000,000
170,000,000
200,000,000
20,000,000
111,000,000
30,000,000
33,000,000
3,000,000
534,000,000