Reference no: EM132990054

Question - On January 1, 2021, P Company acquired 14,000 shares of the outstanding shares of S Company for P2,100,000. On this date, the stockholders' equity of S Company consisted of Share capital of P1,200,000, P60 par, and Retained Earnings of P900,000. The book values of S Company's identifiable assets and liabilities are equal to their fair values. P Company measures the non-controlling interest at fair value.

P Company sold a machinery costing P300,000 with accumulated depreciation of P180,000 to S Company for P150,000 on the date of acquisition. P Company was depreciating the machinery for 5 years with no salvage value using the straight-line method of depreciation and S Company opted in continuing the same method.

At the end of 2021, P Company reported net income of P550,000 and paid dividends of P280,000 while S Company reported net income of P350,000 and paid dividends of P5 per share.

Required -

What is the percentage of interest of the Parent in the Subsidiary?

How much is the net income attributable to the parent?

How much is the non-controlling interest balance in December 31, 2021?

Find the amount of realized gain on sale used to adjust the net income of the parent for 2021?