Leni Co. acquired all of BBM Co's assets and liabilities on October 2, 2021. BBM reported assets with a carrying amount of P2, 496,000 and liabilities of 1,424,000. Leni noted that BBM had 160,000 research and development cost at the acquisition date that did not appear of any value. Leni also determined that patents developed by BBM had a fair value of 480,000 but have not been reported by BBM. Except for building and equipment, Leni determined the fair value of all other assets and liabilities approximated the reported amounts. At acquisition date, Leni recorded a goodwill of P372,000. Leni paid P2,068,000 to acquire BBM's assets and liabilities. If the carrying amount of the building and equipment was P1,364,000, what was the fair value?

Leni Co. acquired all of BBM Co's assets and liabilities on October 2, 2021. BBM reported assets with a carrying amount of P2, 496,000 and liabilities of 1,424,000. Leni noted that BBM had 160,000 research and development cost at the acquisition date that did not appear of any value. Leni also determined that patents developed by BBM had a fair value of 480,000 but have not been reported by BBM. Except for building and equipment, Leni determined the fair value of all other assets and liabilities approximated the reported amounts. At acquisition date, Leni recorded a goodwill of P372,000. Leni paid P2,068,000 to acquire BBM's assets and liabilities. If the carrying amount of the building and equipment was P1,364,000, what was the fair value?

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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