ABC issued 10,000 shares of its common stock, valued at P500,000, to the former shareholders of DEF two years after DEF was acquired in an all-stock transaction. The additional shares were issued because ABC agreed to issue additional shares of common stock if the average post combination earnings over the next years exceeded P1,000,000. ABC will treat the issuance of the additional shares as a (decrease in) A. Share Premium B. Non-current liabilities of DEF assumed by ABC C. Goodwill D. Retained earnings
ABC issued 10,000 shares of its common stock, valued at P500,000, to the former shareholders of DEF two years after DEF was acquired in an all-stock transaction. The additional shares were issued because ABC agreed to issue additional shares of common stock if the average post combination earnings over the next years exceeded P1,000,000. ABC will treat the issuance of the additional shares as a (decrease in) A. Share Premium B. Non-current liabilities of DEF assumed by ABC C. Goodwill D. Retained earnings
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter15: Contributed Capital
Section: Chapter Questions
Problem 4RE: Sun Corporation issues 500 shares of 8 par common stock for a patent. The stock is currently selling...
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ABC issued 10,000 shares of its common stock, valued at P500,000, to the
former shareholders of DEF two years after DEF was acquired in an all-stock
transaction. The additional shares were issued because ABC agreed to issue
additional shares of common stock if the average post combination earnings
over the next years exceeded P1,000,000. ABC will treat the issuance of the
additional shares as a (decrease in)
A. Share Premium
B. Non-current liabilities of DEF assumed by ABC
C. Goodwill
D.
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