1. Rivendell paid finder's fees of P40,000, acCountant's fee (Advisory) of P10,000, legal fees (advisory) of P15,000, salaries of Rivendell's employees assigned to the implementation of the merger of P16,000, cost of closing duplicate facilities of P12,000, cost of shareholder's meeting to vote on the merger of P14,000, cost of printing stock certificates of P7,000, audit and accountant's fee related to the stock issuance of P3,000, SEC registration fee of P5,000 and stock listing application fees of P4,000. Based on the preceding information, under the acquisition method following PFRS 3 what amount relating to the business combination would be expensed P42,000 50,000 C. d. P107,000 124,000 a. b.
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- The following book and fair values were available for NorthStar Company as of March 1. BluePrint Company pays $4,200,000 cash for all of NorthStar’s common stock in a merger, after which NorthStar will cease to exist as a separate entity. BluePrint pays $70,000 for legal fees to complete the transaction. Required: Pass the necessary journal entries in the books of BluePrint for its acquisition of NorthStar’s common stocks.Wagas Corporation and Tapat Company merged as of January 1, 2014. To effect the merger, Wagas paid finder's fees of P40,000, legal fees of P13,000, audit fees related to the stock issuance of P10,000, stock registration fees of P5,000, and stock listing application fees of P4,000. Based on the preceding information: P72,000 of stock issue costs are treated as goodwill. P19,000 of stock issue costs are treated as a reduction in share premium. P19,000 of stock issue costs are expensed. P72,000 of stock issue costs are expensed.MG Corporation exchange 150,000 shares of newly issued P1 par value common stock with a fair market value of P25 per share for all of the outstanding PS par value common stock of GC Company and such is then dissolved. MG Corp. paid the following costs and expenses related to the business combination: Costs of special shareholders’ meeting to vote on the merger P13,000 Registering and issuing securities 14,000 Accounting and legal fees 9,000 Salaries of MG Corp.’s employees assigned to the implementation of the merger 15,000 Cost of closing duplicate facilities 11,000 In the business combination of MG Corp and GC Company Group of answer…
- MG Corporation exchange 150,000 shares of newly issued P1 par value common stock with a fair market value of P25 per share for all of the outstanding PS par value common stock of GC Company and such is then dissolved. MG Corp. paid the following costs and expenses related to the business combination: Costs of special shareholders’ meeting to vote on the merger P13,000 Registering and issuing securities 14,000 Accounting and legal fees 9,000 Salaries of MG Corp.’s employees assigned to the implementation of the merger 15,000 Cost of closing duplicate facilities 11,000 In the business combination of MG Corp and GC Company Group of answer…If Alakdan Co., a new company would acquire the net assets of Cardo and Allana Company by issuing 50,000 shares of P25 par value ordinary shares with fair value of P130 per share and paying professional finders fee and stock registration costs of P125,000 and P65,000, respectively, determine:i. The total amount of Goodwill to be reported by Alakdan Co.ii. The total assets of Alakdan Co. after the business combination.iii. The total stockholders equity of Aklan Co after the business combination.iv. The journal entries to be made by Alakdan Co. for the business combination.Rivendell Corporation and Foster Company merged as of January 1, 2019. To effect the merger, Rivendell paid finder's fees of $40,000, legal fees of $13,000, audit fees related to the stock issuance of $10,000, stock registration fees of $5,000, and stock listing application fees of $4,000. Based on the preceding information, under the acquisition method, what amount relating to the business combination would be expensed Select one: a. 53,000 b. 72,000 c. 19,000 d. 63,000
- RIVERDALE paid finder's fees of P80,000, legal fees of P26,000, audit fees related to stock issuance of P20,000, stock registration fees of P10,000 and stock listing application fees of P8,000. Based on the given information, under the acquisition method, what amount relating to business combination would be charged to expense?On January 1, 20x1, AAA Co. acquired all of the identifiable assets and assumed all of the liabilities of BBB, Inc. by paying cash of ₱2,000,000. On this date, the identifiable assets acquired and liabilities assumed have fair values of ₱3,200,000 and ₱1,800,000, respectively.AAA Co. has estimated restructuring provisions of ₱400,000 representing costs of exiting the activity of BBB, costs of terminating employees of BBB, and costs of relocating the terminated employees.Requirement: Compute for the goodwill (gain on bargain purchase).On May 1, Soriano Co. reported the following account balances along with their estimated fair values:On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To facilitate the merger, Zambrano also paid $100,000 to an investment banking firm.The following information was also available:• Zambrano further agreed to pay an extra $70,000 to the former owners of Soriano only if they meet certain revenue goals during the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at $35,000.• Soriano has a research and development project in process with an appraised value of $200,000. However, the project has not yet reached technological feasibility and the project’s assets have no alternative future use.Prepare Zambrano’s journal entries to record the Soriano acquisition assuming its initial cash payment to the former owners wasa. $700,000.b.…
- Problems 12 and 13 relate to the following:On May 1, Donovan Company reported the following account balances:On May 1, Beasley paid $400,000 in stock (fair value) for all of the assets and liabilities of Donovan, which will cease to exist as a separate entity. In connection with the merger, Beasley incurred $15,000 in accounts payable for legal and accounting fees.Beasley also agreed to pay $75,000 to the former owners of Donovan contingent on meeting certain revenue goals during the following year. Beasley estimated the present value of its probability adjusted expected payment for the contingency at $20,000. In determining its offer, Beasley noted the following:• Donovan holds a building with a fair value $30,000 more than its book value.• Donovan has developed unpatented technology appraised at $25,000, although is it not recorded in its financial records.• Donovan has a research and development activity in process with an appraised fair value of $45,000. The project has not yet…On April 1, 2019, Itaewon Corp. paid cash of P1,240,000 for all the net assets of Sunshine Company appropriately accounted for as a merger. The recorded assets and liabilities of Sunshine Company on April 5, 2019 follow: 300,000 420,000 100,000 0 Del Luna Corporation concluded that the fair value of Scarlet Company was P160,000 and paid that amount to acquire all of its net assets. Scarlet reported assets with a book value of P120,000 and a fair value of 196,000 and liabilities with a book value and fair value of P46,000 on the date of combination. Del Luna also paid P6,000 to a search firm for finder’s fees related to acquisition. What amount will be recorded as goodwill by Del Luna Corporation? 26,000 16,000 0 10,000 On January 1 2021,NOP acquires 100% interest in QRS in exchange for NOP’s 10,000 shares with par value per share of P20 and fair value per share of P200. QRS’s net identifiable assets have fair value of P1,920,000 and a book value of P1,850,000. In addition, NOP…On May 1, Donovan Company reported the following account balances:Current assets . . . . . . . . . . . . $ 90,000Buildings & equipment (net) . 220,000Total assets . . . . . . . . . . . .. . $310,000Liabilities . . . . . . . . . . . . . . . . $ 60,000Common stock . . . . . . . . . . . . . 150,000Retained earnings . . . . . . . . . 100,000Total liabilities and equities . $310,000On May 1, Beasley paid $400,000 in stock (fair value) for all of the assets and liabilities of Donovan, which will cease to exist as a separate entity. In connection with the merger, Beasley incurred $15,000 in accounts payable for legal and accounting fees.Beasley also agreed to pay $75,000 to the former owners of Donovan contingent on meeting certain revenue goals during the following year. Beasley estimated the present value of its probability adjusted expected payment for the contingency at $20,000. In determining its offer, Beasley noted the following:∙ Donovan holds a building with a fair value…