Petron Company issued 80.000 new shares of its P5 par value ordinary shares valued at P12 per share in exchange for 100,000 outstanding shares (P2 par value) of Shell Company on March 31, 2021. The fair value and book value of Shell's identifiable assets and liabilities were the same except Inventory which was overstated by P50.000 and Equipment which was understated by P100.000. The financial statements of Petron and Shell were (see image below). Petron also agreed to pay P500,000 one year after the acquisition date if the net income of Shell will exceed P10,000,000. The fair value of the contingent consideration is P300,000. Petron incurred the following costs: Finder's Fee - 20,000; Professional Fee - 60,000; Other Indirect Cost - 10,000 and Printing and Registration of Shares - 5,000. How much is the goodwill/gain on bargain purchase if NCI is measured using fair value? Petron Shell Cash 75,000 160,000 200,000 1,675,000 2,110,000 60,000 200,000 250,000 875,000 1,385,000 Accounts Receivable Inventory Equipment Total Accounts Payable 800,000 600,000 450,000 260,000 2,110,000 485,000 250,000 50,000 600,000 1,385,000 Share Capital Share Premium Retained Earnings Total

Acquirer Company issued new shares of its P5 par value ordinary shares valued at P12 per share in exchange for 90% outstanding shares (P2 par value) of Acquiree Company on March 31, 2022. The fair value and book value of Acquiree’s identifiable assets and liabilities were the same except inventory which was understated by P30,000 and equipment which was overstated by P90,000. The financial statements of Acquirer and Acquiree were (see image below).Acquirer incurred the following costs: Legal fees – P11,200; Audit fees for SEC registration of share issue - P5,000; Brokerage fee - P2,500; and Accountant fee for pre-acquisition audit – P15,000. The parent opted to measure NCI using proportionate share and the business combination resulted to a goodwill of P99,000. Answer the following:  a. How much is the Consolidated Assets? b. How much is the Consolidated Equity? c. How many is the Number of Shares Issued?

On 1 July 2021, Mel Ltd took control of the assets and liabilities of Syd Ltd. At this date the statement of financial position of Syd Ltd was as follows:     Required Prepare the journal entries in the records of Mel Ltd at 1 July 2021 in each of the following situations, assuming the costs of issuing the shares by Mel Ltd cost $1600.   Mel Ltd issued 80 000 shares having a fair value of $2.40 per share in exchange for the net assets of Syd Ltd Mel Ltd issued 80 000 shares having a fair value of $2.00 per share in exchange for the net assets of Syd Ltd. Mel Ltd acquired the shares of Syd Ltd. The agreement was that Mel Ltd would pay the shareholders of Syd Ltd one share in Mel Ltd for every two shares held in Syd Ltd plus $1 in cash for each share held in Syd Ltd. Shares in Mel Ltd have a fair value of $1.80 per share.

Gold Ltd purchased Silver on 1 June 2023, acquiring all of the assets and liabilities. The price agreed on was $60, 000, payable $20, 000 in cash and the balance by the issue to Silver Ltd of 16, 000 fully paid shares in Gold Ltd, these shares having a fair value of $2.50 per share. The balances of the two companies accounts as at 1 June 2023 were as follows: Gold Ltd Silver LtdCash 30,000 -Accounts receivable 8,000 20,000Inventory 14,000 26,000Plant (net) 50,000 30,000Government bonds 12,000 -Goodwill - 10,000Total assets 114,000 86,000Accounts payable 2,000 20,000Retained earnings 12,000 (24,000)Share capital 100,000 90,000Total liabilities and equity 114,000 86,000 All the identifiable net assets of Silver Ltd were recorded by Silver Ltd at fair value except for the inventories, which were considered to be worth $28,000. The plant had an expected remaining life of 5 years. Gold Ltd incurred incidental costs of $500 in relation to the acquisition. Costs of issuing shares in Gold Ltd…

On January 1, 20x1, Patrick Corp. acquired the identifiable net assets of Jinky Corp. by paying cash of P1,500,000; issuing 50,000 ordinary shares with a market value of P60 per share. Patrick paid the broker’s fee of P25,000; cost if SEC registration of shares issued amounting to P2,000 and indirect cost of P5,000. The book values of assets of Patrick and Jinky are P15,200,000 and P2,500,000, respectively, and the book values of liability of Patrick and Jinky are P4,000,000 and P800,000.   The book value reflects fair value of assets and liabilities except that the current asset of Patrick is overvalued by P200,000 and non-current asset of Jinky Corp is undervalued by P500,000.   Patrick Corp. has estimated P400,000 representing cost of exiting the activity of Jinky Corp such as: cost of terminating employees and the cost of relocating terminated employees of Jinky.   The agreement also provides that Patrick Corp shall pay cash on January 10, 20x1, equal 120% of the amount by which…

On January 1, 20x1, Patrick Corp. acquired the identifiable net assets of Jinky Corp. by paying cash of P1,500,000; issuing 50,000 ordinary shares with a market value of P60 per share. Patrick paid the broker’s fee of P25,000; cost if SEC registration of shares issued amounting to P2,000 and indirect cost of P5,000. The book values of assets of Patrick and Jinky are P15,200,000 and P2,500,000, respectively, and the book values of liability of Patrick and Jinky are P4,000,000 and P800,000.   The book value reflects fair value of assets and liabilities except that the current asset of Patrick is overvalued by P200,000 and non-current asset of Jinky Corp is undervalued by P500,000.   Patrick Corp. has estimated P400,000 representing cost of exiting the activity of Jinky Corp such as: cost of terminating employees and the cost of relocating terminated employees of Jinky.   The agreement also provides that Patrick Corp shall pay cash on January 10, 20x1, equal 120% of the amount by which…

1 On January 2, 2021, Normal Inc. acquired 15% interest in Laco Co. by paying P1,500,000 for 7,500 ordinary shares. On this date, the net assets of Laco Co. totaled P9 million. The investment was classified as a financial asset at fair value through other comprehensive income. The fair values of Laco Co.’s identifiable assets and liabilities approximate their book values. On August 1, 2021, Normal received dividends of P4 per share from Laco Co. Fair value of the stocks on December 31, 2021 was P190. Net income reported by Laco for the year ended amounted to P1,500,000.   On July 1, 2022, Normal Inc. paid P1 million to purchase 5,000 additional shares of Laco Co. from another shareholder. On this date the fair value of the net assets exceeds carrying value by P500,000 attributable to depreciable asset with estimated remaining life of 5 years. On February 1, 2022, cash dividends of P5 were received while dividends of P6 were received on August 1, 2022. Net income reported for the year…

On January 1, 2021 Pail corp acquired 80 percent of Sand Company's stock fo 640,000 cash.  The fair value of the noncontrolling interest at that date was determined to be 160,000. For the year ended December 31 2021 Pail reported dividends of 46,000 on its general ledger.  Sand reported devidends of 37000 on its general ledger.  What amount of dividends would be reported on 12/31/21 consolidated statement of retained earnings?

Palm Corporation and Staple Company have announced terms of an exchange agreement under which Palm will issue 8,500 shares of its $15 par value common stock to acquire all of Staple Company’s assets. Palm shares currently are trading at $59, and Staple $10 par value shares are trading at $23 each. Historical cost and fair value balance sheet data on January 1, 20X2, are as follows:   Palm Corporation   Staple Company     Balance Sheet Item Book Value Fair Value   Book Value Fair Value     Assets                             Cash & Receivables $ 151,000   $ 151,000     $ 46,000   $ 46,000     Land   110,000     190,000       57,000     83,000     Buildings & Equipment (net)   313,000     411,000       176,000     230,000     Total Assets $ 574,000   $ 752,000     $ 279,000   $ 359,000     Equities                             Common Stock $ 200,000           $ 81,000           Additional Paid-In Capital   18,000             9,900           Retained Earnings…

32 Petron Company issued 80,000 new shares of its P5 par value ordinary shares valued at P12 per share in exchange for 100,000 outstanding shares (P2 par value) of Shell Company on March 31, 2021. The fair value and book value of Shell's identifiable assets and liabilities were the same except Inventory which was overstated by P50,000 and Equipment which was understated by P100,000. The financial statements of Petron and Shell were (see image below). Petron also agreed to pay P500,000 one year after the acquisition date if the net income of Shell will exceed P10,000,000. The fair value of the contingent consideration is P300,000. Petron incurred the following costs: Finder's Fee - 20,000; Professional Fee - 60,000; Other Indirect Cost - 10,000 and Printing and Registration of Shares - 5,000. How much is the goodwill/gain on bargain purchase if NCI is measured using proportionate share? Shell Petron 75,000 160,000 200,000 1,675,000 2,110,000 60,000 200,000 250,000 875,000 1,385,000 Cash…