On August 31, 2021, Nutcraker Corp. issued 100,000 shares of its P20 par value ordinary stock for the net assets of Pilar, Inc., in a business combination accounted for by the acquisition method. The market value of Nutcraker Corp. 's ordinary shares on August 31 was P36 per share. Nutcraker paid a fee of P160,000 to the consultant who arranged this acquisition. Cost of registering and issuing the equity securities amounted to P80,000. No goodwill was involved in the purchase. What amount should Nutcraker capitalize as the cost of acquiring Pilar's net assets?
On August 31, 2021, Nutcraker Corp. issued 100,000 shares of its P20 par value ordinary stock for the net assets of Pilar, Inc., in a business combination accounted for by the acquisition method. The market value of Nutcraker Corp. 's ordinary shares on August 31 was P36 per share. Nutcraker paid a fee of P160,000 to the consultant who arranged this acquisition. Cost of registering and issuing the equity securities amounted to P80,000. No goodwill was involved in the purchase. What amount should Nutcraker capitalize as the cost of acquiring Pilar's net assets?
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 1MC
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Transcribed Image Text:On August 31, 2021, Nutcraker Corp. issued 100,000 shares of its P20 par value ordinary stock for
the net assets of Pilar, Inc., in a business combination accounted for by the acquisition method. The
market value of Nutcraker Corp. 's ordinary shares on August 31 was P36 per share. Nutcraker paid
a fee of P160,000 to the consultant who arranged this acquisition. Cost of registering and issuing
the equity securities amounted to P80,000. No goodwill was involved in the purchase. What amount
should Nutcraker capitalize as the cost of acquiring Pilar's net assets?
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