On January 2, 2021, X Co. acquired all the ordinary share of Y Co. for P2,060,000. On that date, Y Co. reported the following stockholders’ equity account balances: Ordinary share P800,000, Share premium P620,000, accumulated profits P300,000. The assets and liabilities of Y Co had book values that were approximately equal to its fair values, except building that was undervalued by P400,000, and equipment that was overvalued by P120,000. The

On January 1, 2021, merma Corp. purchased 80% of the outstandingshares of sand Co. at a cost of P1,620,000. On that date, sand hadP600,000 of ordinary shares and P1,000,000 of retained earnings. Allthe assets and liabilities of sand Co. have book values approximatelyequal to their respective market values, except for equipment with fairmarket value increase of 50,000 (remaining life of 4 years). For 2022, theoperating results of merma and sand are: Net income P1,000,000 andP500,000, respectively; Dividends paid, P200,000 and P80,000,respectively.During 2022, merma Corp. sold merchandise to sand at 120% of its cost,the same as that used in 2021 sales. The inventory of sand on January1, 2022 included P19,200 of merchandise purchased from merma Corp. in2021, while its December 31, 2022 inventory included P36,000 ofmerchandise purchased from merma Corp. in 2022. The RetainedEarnings beg of sand in 2022 was P1,200,000. merma uses theproportionate method in measuring NCI. Impairment loss was…

On January 1, 2019, ALUCARD Co. acquired 80% interest in BERTHOLD, Inc. by issuing 5,000 shares with fair value of P15 per share. On this date, BERTHOLD's equity comprised of P50,000 share capital and P24,000 retained earnings. NCI was measured at its proportionate share in BERTHOLD's net identifiable assets. BERTHOLD's assets and liabilities on January 1, 2019 approximate their fair values except for the following: Fair value Carrying Fair adjustments (FVA) 8,000 BERTHOLD, Inc. атоunts values Inventory 23,000 31,000 Equipment (4 yrs. remaining life) Accumulated depreciation Totals 50,000 60,000 10,000 (10,000) (12,000) 63,000 (2,000) 16,000 79,000 BERTHOLD, Inc. declared and paid dividends of P6,000 during 2019. There was no impairment in goodwill. The year-end individual statements of profit or loss are shown below: Statements of profit or loss For the year ended December 31, 2019 ALUCARD Co. BERTHOLD, Inc. Sales 300,000 (165,000) 120,000 Cost of goods sold (72,000) Gross profit…

On 1/07/2022, Kit Kat limited acquired all the shares in Mars Litd, the shares came with the dividend attached (cum. div). Mars had recorded a $500,000 dividen payable liability. The consideration paid by Kit Kat was $6,400,000. Equity at that date is: Share capital: $3,000,000 General reserve: $635,000 Retained earnings: $1,800,000 All assets were recorded at fair value except for the following in the    Carrying amount Fair value Inventory $620,000 $643,000 Land $1,800,000 $2,000,000 Plant (accum. deon of $1,750,000) $3,250,000 $3,575,000 Patent $740,000 $615,000 Kit Kat recognised a brand with a value of $220,000 for Mars. The patent had accumulated amortisation of $740,000 with a remaining useful life of 8 years at acquisition. 1) Determine the gain on bargain purchase or goodwill as at acquisition date.