Parent Company, an SME issued 60,000 shares of P100 par value ordinary shares for all the outstanding stock of Sub Company in business combination consummated on January 2, 2022. Parent's ordinary shares were selling at P160/sh at the time of acquisition. The book value of Sub's net assets was P7,600,000. Out of pocket costs of combination were as follows: Legal fees for business combination, P24,000; printing cost for stock certificate, P18,800; finder's fee, P54,000; and CPA audit fee for business combination, P38,000. A contingent consideration that is probable and can be reasonably estimated amounted to P36,400. The total amount to be capitalized as cost of investment in Sub Company is: * O O 9,752,400 O 9,600,000 O 9,716,000 O 9,636,400

Parent Company, an SME issued 60,000 shares of P100 par value ordinary shares for all the outstanding stock of Sub Company in business combination consummated on January 2, 2022. Parent's ordinary shares were selling at P160/sh at the time of acquisition. The book value of Sub's net assets was P7,600,000. Out of pocket costs of combination were as follows: Legal fees for business combination, P24,000; printing cost for stock certificate, P18,800; finder's fee, P54,000; and CPA audit fee for business combination, P38,000. A contingent consideration that is probable and can be reasonably estimated amounted to P36,400. The total amount to be capitalized as cost of investment in Sub Company is: * O O 9,752,400 O 9,600,000 O 9,716,000 O 9,636,400

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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Parent Company, an SME issued 60,000 shares of P100 par value ordinary shares for all the outstanding stock of Sub Company in business combination consummated on January 2, 2022. Parent's ordinary shares were selling at P160/sh at the time of acquisition. The book value of Sub's net assets was P7,600,000. Out of pocket costs of combination were as follows: Legal fees for business combination, P24,000; printing cost for stock certificate, P18,800; finder's fee, P54,000; and CPA audit fee for business combination, P38,000. A contingent consideration that is probable and can be reasonably estimated amounted to P36,400.The total amount to be capitalized as cost of investment in Sub Company is:
Parent Company, an SME issued 60,000 shares of P100 par value ordinary shares for all the outstanding stock of Sub Company in business combination consummated on January 2, 2022. Parent's ordinary shares were selling at P160/sh at the time of acquisition. The book value of Sub's net assets was P7,600,000. Out of pocket costs of combination were as follows: Legal fees for business combination, P24,000; printing cost for stock certificate, P18,800; finder's fee, P54,000; and CPA audit fee for business combination, P38,000. A contingent consideration that is probable and can be reasonably estimated amounted to P36,400. The total amount to be capitalized as cost of investment in Sub Company is: * G O 9,752,400 O 9,600,000 O 9,716,000 O 9,636,400
P Company, an SME, issued 120,000 shares of P25 par value ordinary shares for all the outstanding stock of S Company in business consummated on July 1, 2022. P Company’s ordinary shares were selling at P40 per share at the time of consummation of the combination. The book value of S net assets was P3.8M. out of pocket costs of combination were as follows:(1) Legal fees for business combination - P12,000(2) Legal fees for SEC registration - 14,500(3) SEC registration costs - 18,200(4) Printing costs of share certificates - 9,400(5) Finder's fees - 27,000(6) CPA audit fees for SEC registration in #3 - 19,000How much is the capitalized cost of investment?
Name Company, an SME, issued 120,000 shares of P25 par value ordinary shares for all the outstanding stock of 5 Company in business consummated on July 1, 2022. Name Company's ordinary shares were selling at P40 per share at the time of consummation of the combination. The book value of Name net assets was P3.8M. out of pocket costs of combination were as follows: (1) Legal fees for business combination - P12,000 (2) Legal fees for SEC registration - 14,500 (3) SEC registration costs - 18,200 (4) Printing costs of share certificates - 9,400 (5) Finder's fees - 27,000 (6) CPA audit fees for SEC registration in #3 - 19,000 Question: How much is the capitalized cost of investment?
Parent Company issued 50,000 shares of P100 par ordinary share for all outstanding shares of Subsidiary Company in a business combination consummated in July 1, 2020. Parent Company’s ordinary shares was selling at P102 per share at the time of the consummation of the combination. Subsidiary Company’s net asset on the date of acquisition has a carrying amount of P3,800,000. Out of pocket expenses of the combination were as follows:Legal fees 50,000Finder’s fees 25,000CPA audit fees 50,000Printing of stock certificates 65,000 Determine the amount charged to expense:
P Company acquired all the outstanding shares of S Company by issuing 50,000 shares with a par value of P100 on July 1, 2021. P's ordinary shares were selling at P102 per share at the date of acquisition. On the same date, the net asset of S had a carrying value and fair value of P3,800,000 and P4,500,000 respectively. Out of pocket expenses of the business combination were as follows (see image below). How much is the amount charged to expense? Legal fees for contract of business combination Audit fees for SEC registration of share issue Brokerage fee Accountant fee for pre-acquisition audit Printing and registration of stock certificates Other direct costs of acquisition 41,200 50,000 22,500 35,000 10,000 16,800 General administrative costs 25,000 12,100 Listing fees in issuing new shares
Ugly Corp. issued 50,000 shares of P100 par ordinary share for all outstanding shares of Dolls Company in a business combination consummated in July 1, 2019. Ugly’s ordinary shares was selling at P102 per share at the time of the consummation of the combination. Dolls’ net asset on the date of acquisition has a carrying amount of P3,800,000. Out of pocket expenses of the combination were as follows:Legal fees P50,000Finder’s fees 25,000CPA audit fees 50,000Printing of stock certificates 65,000Determine the amount charged to expense:
Pauline Company acquired 4,000 shares of the outstanding stock of Sophia Company for P1,200,000 on January 1, 2020. Pauline Company also paid P100,000 direct costs related to the combination. On this date, the stockholders equity of Sophia Company consisted of Capital Stock of P500,000, P100 par and Retained Earnings of P600,000. The carrying values of Sophia Company identifiable assets and liabilities are equal to their fair market values. NCI is measured at its proportionate share.On the same date, Pauline Company sold equipment costing P100,000 with accumulated depreciation of P60,000 to Sophia Company for P120,000. Pauline Company was depreciating the equipment for 10 years with no salvage value using the straight-line method and Sophia Company continued the same method. At the end of the year, Pauline Company reported net income of P300,000 and paid dividends of P250,000 while Sophia Company reported net income of P200,000 and paid dividends of P10 per share.The consolidated net…
On August 31, 2020, Laida Corporation purchased all the net assets of Magtalas Corporation by transferring cash of P500,000 and issuing 40,000 ordinary shares with par value of P50 (current fair value is P60). The following are expenses incurred and paid by Laida Corporation in connection with the business combination on the date of acquisition: Underwriting costsP10,000Consultant’s fees20,000Newspaper publication fees5,000SEC registration fees8,000Stock exchange listing fees5,000Indirect acquisition costs12,000How much expense is charged to share premium?
On January 2, 2022, Papa, Inc. acquired 80% of the outstanding shares of Son Company for P1,952,000 cash. At the time of the acquisition, the stockholders' equity section of the two companies is shown: (Amounts In Thousands) Parent, Inc. Subsidiary Corp.Ordinary share capital 4,000 1,600 Ordinary share premium 3,000 480 Retained earnings 6,840 420 Total 13,840 2,500 Direct costs of business combination incurred amounted to P33,000.Assuming NCI is measured at proportionate share. What is the consolidated shareholders' equity on January 2, 2022?
TWICE Company acquired BTS Company on February 6, 2022. The following out of pocket costs of the combination are as follows:Legal fees for business combination contract- P174,700Audit fees for SEC registration of share issue- 198,400Printing cost of stock certificates- 144,900Broker's fee- 135,000Accountant's fee for pre-acquisition audit- 161,000Other direct cost of acquisition- 90,400General and allocated expenses- 115,300Stock exchange listing fees in issuing shares- 172,000What is the amount of expense to be recognized in the Statement of Comprehensive Income for the year 2022?
Parent Company acquired Sub Company on February 6, 2022. The following out of pocket costs of the combination are as follows:Legal fees for business combination contract- P174,700Audit fees for SEC registration of share issue- 198,400Printing cost of stock certificates- 144,900Broker's fee- 135,000Accountant's fee for pre-acquisition audit- 161,000Other direct cost of acquisition- 90,400General and allocated expenses- 115,300Stock exchange listing fees in issuing shares- 172,000What is the amount of expense to be recognized in the Statement of Comprehensive Income for the year 2022? A. 1,046,800 B. 676,400 C. 874,800 D. 848,400