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On July 1, 2017, Entity H acquired 25% of the shares of Oki, Inc. for P1,000,000. At the date, the equity of Oki was P4,000,000, with all the identifiable assets and liabilities being measured at amounts equal to fair value. The table below shows the profits and losses made by Oki during 2017 to 2021: YEAR      PROFIT(LOSS) 2017         P200,000 2018         (2,000,000) 2019         (2,500,000) 2020              160,000 2021               300,000 How much share of profit of assocaiate should Entity H report in its 2020 profit or loss? a.Nil b. P40,000 c. P60,000 d. P100,000

On July 1, 2017, Entity H acquired 25% of the shares of Oki, Inc. for P1,000,000. At the date, the equity of Oki was P4,000,000, with all the identifiable assets and liabilities being measured at amounts equal to fair value. The table below shows the profits and losses made by Oki during 2017 to 2021: YEAR      PROFIT(LOSS) 2017         P200,000 2018         (2,000,000) 2019         (2,500,000) 2020              160,000 2021               300,000 How much share of profit of assocaiate should Entity H report in its 2020 profit or loss? a.Nil b. P40,000 c. P60,000 d. P100,000

FINANCIAL ACCOUNTING
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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On July 1, 2017, Entity H acquired 25% of the shares of Oki, Inc. for P1,000,000. At the date, the equity of Oki was P4,000,000, with all the identifiable assets and liabilities being measured at amounts equal to fair value. The table below shows the profits and losses made by Oki during 2017 to 2021:

YEAR      PROFIT(LOSS)

2017         P200,000

2018         (2,000,000)

2019         (2,500,000)

2020              160,000

2021               300,000

How much share of profit of assocaiate should Entity H report in its 2020 profit or loss?

a.Nil

b. P40,000

c. P60,000

d. P100,000

 

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