Parent Co. sells P200,000 of inventory to Subsidiary Co. with a 25% markup on cost.

At year-end, 60% of this

inventory remains unsold by the subsidiary.
1. What is the unrealized profit to be eliminated in consolidation?

Subsidiary Co. (60% owned company) sells inventory to Parent Co. for P150,000. Subsidiary Co. sold 80% of the
inventory to external customers for P200,000.
2. If the cost of the inventory was P120,000, what is the unrealized profit to be eliminated in
consolidation?

Subsidiary Co. (75% owned company) sold inventory to Parent Co. for P100,000 with a 30% gross profit margin.
Parent Co. still holds 80% of the inventory at year-end.
3. What the eliminating entries to be made?

In year 1, Parent Co. sells inventory costing P50,000 to its 80% owned Subsidiary Co. for P80,000. By year-end, the
subsidiary has sold 75% of the inventory to third parties. In year 2, Subsidiary Co. purchases inventory from Parent
Co. for P120,000, with a 40% profit margin. By the end of the year, Subsidiary Co. sold 60% of the inventory to
external customers.
4. What is the net adjustment to profit to be made in year 1 and year 2?
5. If Parent Co and Subsidiary Co report sales of P500,000 and P400,000 in year 1, what is the
consolidated sales?
6. If Parent Co and Subsidiary Co report sales of P600,000 and P350,000 in year 2, what is the
consolidated sales?
7. If Parent Co and Subsidiary Co report cost of sales of P400,000 and P200,000 in year 1, what is the
consolidated cost of sales?
8. If Parent Co and Subsidiary Co report cost of sales of P360,000 and P250,000 in year 2, what is the
consolidated cost of sales?
9. If Parent Co and Subsidiary Co report net income of P200,000 and P150,000 in year 1, what is the net
income attributable to the parent and non-controlling interest?
10. If Parent Co and Subsidiary Co report net income of P250,000 and P200,000 in year 2, what is the
income attributable to the parent and non-controlling interest?
11. If Parent Co and Subsidiary Co report ending inventory of P450,000 and P300,000 in year 1, what is
the consolidated inventory for year 1?
12. If Parent Co and Subsidiary Co report ending inventory of P500,000 and P350,000 in year 1, what is
the consolidated inventory for year 2?

In year 1, Parent Co. purchases inventory costing P40,000 from its 80% owned Subsidiary Co. for P80,000. By year-
end, the parent has sold 70% of the inventory to third parties. In year 2, Subsidiary Co. purchases inventory from
Parent Co. for P150,000, with a 30% profit margin. By the end of the year, Subsidiary Co. sold 60% of the inventory
to external customers.
13. If Parent Co and Subsidiary Co report sales of P600,000 and P500,000 in year 1, what is the
consolidated sales?
14. If Parent Co and Subsidiary Co report sales of P750,000 and P550,000 in year 2, what is the
consolidated sales?
15. If Parent Co and Subsidiary Co report cost of sales of P500,000 and P300,000 in year 1, what is the
consolidated cost of sales?
16. If Parent Co and Subsidiary Co report cost of sales of P600,000 and P350,000 in year 2, what is the
consolidated cost of sales?
17. If Parent Co and Subsidiary Co report net income of P150,000 and P120,000 in year 1, what is the net
income attributable to the parent and non-controlling interest?
18. If Parent Co and Subsidiary Co report net income of P200,000 and P180,000 in year 2, what is the
income attributable to the parent and non-controlling interest?

On January 1, Parent Co. sells equipment with a book value of P400,000 to its 70% owned Subsidiary Co. for
P500,000. The equipment has a remaining useful life of 10 years.
19. What are the eliminating entries to be made for the 1st year?
20. If Parent Co and Subsidiary Co report net income of P400,000 and P280,000 in the 1st year, what is the
net income attributable to the parent and non-controlling interest?

Parent Co. sells land with a carrying amount of P600,000 to its 80% owned Subsidiary Co. for P800,000. The land
remains unsold at year-end. Subsidiary Co. sold equipment to Parent Co. for P150,000 on April 1. The book value of
the equipment was P120,000, and the remaining useful life is 5 years.
21. If Parent Co and Subsidiary Co report net income of P800,000 and P600,000 for the year, what is the
net income attributable to the parent and non-controlling interest?

On January 1, 20x4 a 70% owned Subsidiary Co. sells a machine with a carrying value of P80,000 to Parent Co. for
P120,000. The machine has a remaining useful life of 8 years. On January 1, 20x5, Parent Co. sells equipment to
Subsidiary Co. for P200,000. The equipment had a book value of P220,000 and a remaining useful life of 5 years.
22. If Parent Co and Subsidiary Co report total PPE of P1,500,000 and P1,200,000 at the end of 20x5, what
is the consolidated PPE to be reported at the end of 20x5?
23. If Parent Co and Subsidiary Co report net income of P500,000 and P400,000 for the year, what is the
net income attributable to the parent and non-controlling interest?
24. If Parent Co and Subsidiary Co report depreciation expense of P150,000 and P80,000 for the year,
what is the consolidated depreciation expense for the year?

On January 1, 20x4, an 80% owned Subsidiary Co. sold equipment with a book value of P500,000 to Parent Co. for
PP600,000. The equipment has a remaining useful life of 10 years. Parent Co sold the equipment to an unaffiliated
company for P580,000 on July 1, 20x6.
25. If Parent Co and Subsidiary Co report net income of P400,000 and P300,000 for the year, what is the
net income attributable to the parent and non-controlling interest?
26. What is the consolidated gain or loss to be reported in the consolidated financial statements for 20x6?

Parent Company purchased 80% of the outstanding shares of Subsidiary Company for P800,000 on January 1, 20x1.
On this date, subsidiary reports capital stock and retained earnings of P600,000 and P300,000 each respectively. It is
determined that a subsidiary’s equipment with a remaining 5-year life is understated by P80,000. The non-controlling
interest is to be valued at its proportional share in the subsidiary’s net assets.
In year 1, Parent Co. sells inventory to Subsidiary Co. for P90,000 at a gross profit of 25%. Subsidiary resells 40%
of the inventory to third parties by year-end. Subsidiary Co. sold inventory costing P70,000 to Parent Co. for P100,000.
By year-end, Parent Co. has resold 60% of the inventory to external parties. On April 1, Parent Co. sells equipment
with a carrying value of P350,000 to Subsidiary Co. for P300,000. The equipment has a remaining useful life of 5
years.

In year 2, Subsidiary Co. sells inventory to Parent Co. for P250,000, with a gross profit margin of 35%. At year-end,
30% of this inventory is still held by Parent Co. Parent Co owes Subsidiary Co P20,000 at year end. On July 1,
Subsidiary Co. sells a truck to Parent Co. for P120,000. The carrying amount of the truck is P90,000, and it has a
remaining useful life of 6 years.

Parent Co and Subsidiary Co report the following on December 31, 20x2.

Parent Co Subsidiary Co
Net Income 250,000 150,000
Dividends Declared 200,000 80,000
Assets 2,500,000 1,400,000
Liabilities 300,000 200,000

27. What is the income attributable to the parent?

28. What is the income attributable to the non-controlling interest?
29. What is the non-controlling interest in net assets on December 31, 20x2?
30. If the parent reports retained earnings of P500,000 on December 31, 20x2, what is the consolidated
retained earnings on December 31, 20x2?
31. What is the consolidated assets?
On January 1, 20x6, an 80% owned Subsidiary Co. sells land to Parent Co. for P1,200,000. The carrying value of the
land is P900,000. On April 1, 20x6, Parent Co. sells equipment to Subsidiary Co. for P200,000. The equipment had a
book value of P150,000 and a remaining useful life of 5 years. On June 30, 20x7, Subsidiary Co. sells machinery to
Parent Co. for P100,000. The machinery’s book value is P80,000, and it has a remaining useful life of 4 years. Parent
Co sold the land purchased from the parent in November 30, 20x7 for P1,250,000. Subsidiary Co declares dividends
of P50,000 for 20x7.
1. If Parent Co and Subsidiary Co report net income of P500,000 and P400,000 for the year, what is the
net income attributable to the parent and non-controlling interest?
2. If Parent Co and Subsidiary Co report total PPE of P800,000 and P350,000 at the end of 20x7, what is
the consolidated PPE to be reported at the end of 20x5?