Consolidated Financial Statements: XYZ, Inc. Carrying Amounts Fair Values Fair Value Adjustments (FVA)
Consolidated Financial Statements: XYZ, Inc. Carrying Amounts Fair Values Fair Value Adjustments (FVA)
Consolidated Financial Statements: XYZ, Inc. Carrying Amounts Fair Values Fair Value Adjustments (FVA)
On January 1, 20x1, ABC Co. acquired 80% interest in XYZ, Inc. The business combination resulted
to goodwill of ₱3,000. On this date, XYZ’s equity comprised of ₱50,000 share capital and ₱24,000
retained earnings. NCI was measured at its proportionate share in XYZ’s net identifiable assets.
XYZ’s assets and liabilities on January 1, 20x1 approximate their fair values except for the following:
Carrying Fair Fair value adjustments
XYZ, Inc.
amounts values (FVA)
Inventory 23,000 31,000 8,000
Equipment (4 yrs. remaining
life) 50,000 60,000 10,000
Accumulated depreciation (10,000) (12,000) (2,000)
Totals 63,000 79,000 16,000
1. How much is the total unrealized gross profit from the intercompany sales of inventory?
a. 2,000
b. 800
c. 2,800
d. 3,600
“This poor man cried out and the Lord heard him and saved him out of all his troubles.”
(Psalm 34:6)
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