Presented below are the condensed income statement of Vital Corporation for the yearsended December 31, 2020 and 2019:202020195,000,0003,350,0001,650,000675,000975,000200,0001,175,000411,250763,750Sales4,900,0003.300,0001,600,000650,000950,000Cost of goods soldGross incomeOperating expensesOperating incomeGain on sale of divisionNet income before income taxIncome tax expense (35%)Net income950,000332,500617.500On October 10, 2020, Chalangs entered into an agreement to sell the assets of one of itsgeographical segments. The geographical segment comprises operations and cash flowsthat can be clearly distinguished, operationally and for financial reporting purposes, fromthe rest of the company. The segment was sold on December 31, 2020, for P1,750,000.The book value of the segment's assets was P1,550,000. The segment's contribution toChalangs' operating income before tax for each year was as follows:2020113,750 loss81,250 income2019Assume that by December 31, 2020, the segment had not yet been sold but wasconsidered held for sale. The fair value of the segment's assets on December 31 wasP1,250,000. The post-tax loss from discontinued operations for 2020, based on theabove data, should be: The statement of changes in equity of Corinthian Corp. shows the following balances as of January 1,2021:Ordinary share capital (P5 par, 250,000 shares authorized, 137,500 issued andoutstanding)Share premiumUnappropriated retained earningsAppropriated retained earningsTotal equityThe corporation had the following equity transactions for during 2021:Jan 15 Completed the building renovation for which 250,000 of retained earnings had beenP 687,500275,000667,500250.000P1880.000restricted. Paid the contractor P242,500, all of which is capitalized.Mar 3 Issued 50,000 additional ordinary shares for P8.00 per share.May 18 Declared a dividend of P1.50 per share to be paid on July 31, 2021, to shareholders ofrecord on June 30, 2021.June 19 Approved additional building renovation to be funded internally. The estimated cost of theproject is P200,000, and retained earnings are to be restricted for that amount.July 31 Paid the cash dividend.Dec 31 Declared a property dividend to be paid on January 10, 2022, to shareholders of record onJanuary 5, 2022. The dividend is to consist of equipment with a carrying value of P150,000.The equipment's fair value at December 31, 2021 is P157,500.31 Reported P442,500 of net income on December 31, 2021 income statement.Required: Compute for the total equity to shown in the 2021 Statement of Changes in Equity andsubsequently carried forward to the Statement of Financial Position.

Operations that do not remain as a part of the business in the future.

Assume that by December 31, 2020, the segment had not yet been sold but was considered held for sale. The fair value of the segment's assets on December 31 was P1,250,000. The post-tax loss from discontinued operations for 2020, based on the above data, should be:

Assume that by December 31, 2020, the segment had not yet been sold but was considered held for sale. The fair value of the segment's assets on December 31 was P1,250,000. The post-tax loss from discontinued operations for 2020, based on the above data, should be:

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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