4. Entity A acquired 20% interest in Entity B on March 31, 2011for P500,000. Entity B reports profit of P1M in 20x1, which wasearned evenly throughout the period, and declares dividends of P300,000 at year-end. In 20x2, Entity B reports loss ofP200,000 and declares no dividends. What is the carryingamount of the investment in associate on December 31, 20x2?C. 600,000d. 640,000a. 550,000b. 590,000

Solution : Given Interest of A in B =20% Acquisition amount =500,000 For year…

Answered: 4. Entity A acquired 20% interest in…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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4. Entity A acquired 20% interest in Entity B on March 31, 20 for P500,000. Entity B reports profit of P1M in 20x1, which was earned evenly throughout the period, and declares dividends