Question 1

consideration 180,000 75% NCI (25%) 60,000

240,000 100%
FV of net assets 200,000
BV of net assets 200,000
a. consideration - fv 40,000 goodwill
b. FV-BV -
c. consideration - bv 40,000 total excess

total P (75%) NCI (25%)

income from S 40,000 30,000 10,000
dividend from S 20,000 15,000 5,000 (minus)
income-dividend 20,000 15,000 5,000

total P (75%) NCI (25%)

initial investment 240,000 180,000 60,000
income from S 40,000 30,000 10,000
dividend from S 20,000 15,000 5,000 (minus)
ending investment 260,000 195,000 65,000

capital stock 150,000

retained earnings 70,000
goodwill 40,000
investment in S 195,000
NCI (25%) 65,000
dividend payable 7,500
dividend receivable 7,500

Consolidated balance sheet P S Dr Cr Consolidated

cash 8,250 35,000 43,250
dividend receivable 7,500 7,500 -
other current assets 40,000 50,000 90,000
land 50,000 30,000 80,000
plant assets 100,000 150,000 250,000
investment in S 195,000 195,000 -
goodwill 40,000 40,000
total assets 400,750 265,000 503,250
accounts payable 40,750 35,000 75,750
dividend payable 10,000 7,500 2,500
capital stock 150,000 150,000 150,000 150,000
retained earnings 210,000 70,000 70,000 210,000
NCI (25%) 65,000 65,000
total L & E 400,750 265,000 267,500 267,500 503,250

Question 3
consideration 2,080,000 80%
2,600,000 100% NCI (20%) 520,000
FV of net assets 2,500,000
BV of net assets 2,500,000
a. consideration - fv 100,000 goodwill
b. FV-BV -
c. consideration - bv 100,000 total excess
P NCI (20%) total
beginning investment 2,080,000 520,000 2,600,000
add: income from S 400,000 100,000 500,000
less: dividend from S 160,000 40,000 200,000
ending investment 2,320,000 580,000 2,900,000

elimination entry:
capital stock 1,000,000
retained earnings 1,800,000
goodwill 100,000
investment in S 2,320,000
NCI (20%) 580,000
accounts payable 100,000
accounts receivable 100,000
dividend payable 160,000
dividend receivable 160,000

Consolidated balance sheet P S Dr Cr Consolidated

cash 300 80 380
accounts receivable 400 200 100 500
dividend receivable 160 - 160 -
equipment 1,000 800 1,800
building 2,000 1,000 3,000
land 1,600 1,400 3,000
investment in S 2,320 2,320 -
goodwill 100 100
total assets 7,780 3,480 8,780
accounts payable 500 80 100 480
dividends payable 100 200 160 140
notes payable 1,000 400 1,400
capital stock 2,000 1,000 1,000 2,000
retained earnings 4,180 1,800 1,800 4,180
NCI (20%) 580 580
total L & E 7,780 3,480 3,160 3,160 8,780