Reference no: EM132799258

Question - On July 1, 2016 TICKLE Company purchased 80% of the outstanding shares of DOODLE Company at a cost of P1,600,000. On that date, DOODLE had P1,000,000 of capital stock and P1,400,000 of retained earnings.

For 2016, TICKLE had income of P560,000 from its separate operations and paid dividends of P300,000. For 2016, DOODLE reported income of P130,000 and paid dividends of P60,000. All the assets and liabilities of DOODLE have book values equal to their respective fair market values.

Assume income was earned evenly throughout the year except for the intercompany transaction on October 1. On October 1, TICKLE purchased an equipment from DOODLE for P200,000. The book value of the equipment on that date was P240,000.

The loss of P40,000 is reflected in the income of DOODLE indicated above. The equipment is expected to have a useful life of 5 years from the date of sale.

In the December 31, 2014 consolidated statement of financial position, determine the consolidated net income attributable to the parent company?

a) 930,400

b) 946,400

c) 642,400

d) 962,400