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Entity A acquired the net assets of Entity B by issuing 10,000 of its ordinary shares with par value of P10 and bonds payable with face value of P500,000. The bonds are classified as financial liability at amortized cost. At the time of acquisition, the ordinary shares are publicly quoted at P20 per share. On the other hand, the bonds payable are trading at 110. Entity A paid P10,000 stock issuance costs and P20,000 bond issue costs. Entity A also have unpaid P40,000 acquisition related costs and P30,000 indirect costs of business combination. Before the date of acquisition, Entity A and Entity B reported the following data: Entity A P1,000,000 2,000,000 200,000 300,000 500,000 1,200,000 800,000 Entity B P 500,000 1,000,000 400,000 500,000 200,000 300,000 100,000 Current assets Noncurrent assets Current liabilities Noncurrent liabilities Ordinary shares Share premium Retained earnings At the time of acquisition, the current assets of Entity A have fair value of P1,200,000 while the noncurrent assets of Entity B have fair value of P1,300,000. On the same date, the current liabilities of Entity B have fair value of P600,000 while the noncurrent liabilities of Entity A have fair value of P500,000.

Entity A acquired the net assets of Entity B by issuing 10,000 of its ordinary shares with par value of P10 and bonds payable with face value of P500,000. The bonds are classified as financial liability at amortized cost. At the time of acquisition, the ordinary shares are publicly quoted at P20 per share. On the other hand, the bonds payable are trading at 110. Entity A paid P10,000 stock issuance costs and P20,000 bond issue costs. Entity A also have unpaid P40,000 acquisition related costs and P30,000 indirect costs of business combination. Before the date of acquisition, Entity A and Entity B reported the following data: Entity A P1,000,000 2,000,000 200,000 300,000 500,000 1,200,000 800,000 Entity B P 500,000 1,000,000 400,000 500,000 200,000 300,000 100,000 Current assets Noncurrent assets Current liabilities Noncurrent liabilities Ordinary shares Share premium Retained earnings At the time of acquisition, the current assets of Entity A have fair value of P1,200,000 while the noncurrent assets of Entity B have fair value of P1,300,000. On the same date, the current liabilities of Entity B have fair value of P600,000 while the noncurrent liabilities of Entity A have fair value of P500,000.

Financial Accounting
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 2E
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Determine the consolidated amounts at the time of acquisition:

    1. Consolidated Assets                  _____
    2. Consolidated Liability                 _____
    3. Consolidated Share Capital       _____
    4. Consolidated APIC                      _____
    5. Consolidated RE                          _____
    6. Consolidated SHE                       _____
Snip & Sketch O New Entity A acquired the net assets of Entity B by issuing 10,000 of its ordinary shares with par value of P10 and bonds payable with face value of P500,000. The bonds are classified as financial liability at amortized cost. At the time of acquisition, the ordinary shares are publicly quoted at P20 per share. On the other hand, the bonds payable are trading at 110. Entity A paid P10,000 stock issuance costs and P20,000 bond issue costs. Entity A also have unpaid P40,000 acquisition related costs and P30,000 indirect costs of business combination. Before the date of acquisition, Entity A and Entity B reported the following data: Entity A P1,000,000 2,000,000 200,000 300,000 500,000 1,200,000 800,000 Entity B P 500,000 1,000,000 400,000 500,000 200,000 300,000 100,000 Current assets Noncurrent assets Current liabilities Noncurrent liabilities Ordinary shares Share premium Retained earnings At the time of acquisition, the current assets of Entity A have fair value of P1,200,000 while the noncurrent assets of Entity B have fair value of P1,300,000. On the same date, the current liabilities of Entity B have fair value of P600,000 while the noncurrent liabilities of Entity A have fair value of P500,000.
Transcribed Image Text:Snip & Sketch O New Entity A acquired the net assets of Entity B by issuing 10,000 of its ordinary shares with par value of P10 and bonds payable with face value of P500,000. The bonds are classified as financial liability at amortized cost. At the time of acquisition, the ordinary shares are publicly quoted at P20 per share. On the other hand, the bonds payable are trading at 110. Entity A paid P10,000 stock issuance costs and P20,000 bond issue costs. Entity A also have unpaid P40,000 acquisition related costs and P30,000 indirect costs of business combination. Before the date of acquisition, Entity A and Entity B reported the following data: Entity A P1,000,000 2,000,000 200,000 300,000 500,000 1,200,000 800,000 Entity B P 500,000 1,000,000 400,000 500,000 200,000 300,000 100,000 Current assets Noncurrent assets Current liabilities Noncurrent liabilities Ordinary shares Share premium Retained earnings At the time of acquisition, the current assets of Entity A have fair value of P1,200,000 while the noncurrent assets of Entity B have fair value of P1,300,000. On the same date, the current liabilities of Entity B have fair value of P600,000 while the noncurrent liabilities of Entity A have fair value of P500,000.
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