Homework Help is Here – Start Your Trial Now!
Business
Accounting
Determine the fair value of consideration transferred on the business combination? How many shares were issued in the business combination

Determine the fair value of consideration transferred on the business combination? How many shares were issued in the business combination

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 26E
See similar textbooks
icon
Related questions
Question
  1. Determine the fair value of consideration transferred on the business combination?
  2. How many shares were issued in the business combination?
On January 1, 2021, ABC Co. acquired all of the identifiable assets and assumed all of the liabilities of XYZ, Inc. by issuing its own ordinary shares. Information at acquisition date is shown below: (see image below) Additional information: 1. ABC Co's share capital consists of 60,000 ordinary shares with par value of P40 per share. 2. XYZ's share capital consists of 3,000 ordinary shares with par value of P400 per share. Determine the fair value of consideration transferred on the business combination? АВС Со XYZ Inc Combined (carrying amounts) (fair values) Identifiable assets 9,600,000 6,400,000 16,000,000 Goodwill Total assets 9,600,000 6,400,000 ? Liabilities 2,800,000 2,400,000 3,600,000 6,400,000 2,800,000 Share capital Share premium Retained earnings Total liabilities & equity 1,200,000 1,200,000 3,200,000 9,600,000 1,000,000 600,000 4,800,000 6,400,000 ?
Transcribed Image Text:On January 1, 2021, ABC Co. acquired all of the identifiable assets and assumed all of the liabilities of XYZ, Inc. by issuing its own ordinary shares. Information at acquisition date is shown below: (see image below) Additional information: 1. ABC Co's share capital consists of 60,000 ordinary shares with par value of P40 per share. 2. XYZ's share capital consists of 3,000 ordinary shares with par value of P400 per share. Determine the fair value of consideration transferred on the business combination? АВС Со XYZ Inc Combined (carrying amounts) (fair values) Identifiable assets 9,600,000 6,400,000 16,000,000 Goodwill Total assets 9,600,000 6,400,000 ? Liabilities 2,800,000 2,400,000 3,600,000 6,400,000 2,800,000 Share capital Share premium Retained earnings Total liabilities & equity 1,200,000 1,200,000 3,200,000 9,600,000 1,000,000 600,000 4,800,000 6,400,000 ?
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Accounting for Business Combinations
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
SWFT Comprehensive Volume 2019
SWFT Comprehensive Volume 2019
Accounting
ISBN:
9780357233306
Author:
Maloney
Publisher:
Cengage
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
SWFT Corp Partner Estates Trusts
SWFT Corp Partner Estates Trusts
Accounting
ISBN:
9780357161548
Author:
Raabe
Publisher:
Cengage
SWFT Comprehensive Vol 2020
SWFT Comprehensive Vol 2020
Accounting
ISBN:
9780357391723
Author:
Maloney
Publisher:
Cengage
Financial Accounting
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS