Question

Aviene Corporation acquired 90 percent of the ordinary shares of Shelly Company on March 31, 2016, at book value. Shelly reported net income of P112,000 for the year 2016 and paid no dividends. Prior to the acquisition by Aviene, Shelly had 2016 revenues of P133,000 and expenses of P100,800. Aviene reported income of P196,000 from its own operations for 2016. Consolidated net income for 2016 is:​

Answer 1

Answer:

The subsidiary's stock and the related stockholders' equity accounts must be eliminated because the stock of the subsidiary is 80% held within the consolidated entity.

Explanation:

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