Senpai Company acquires 15% of Kohai Company's common stock for P600,000 cash and carries the investment using the cost model. A few months later, Senpai purchases another 60% of Kohai Company's stock for P2,592,000. At that date, Kohai Company reports identifiable assets with a book value of P4,680,000 and a fair value of P6,120,000, and it has liabilities with a book value and fair value of P2,280,000. The fair value of the 25% non-controlling interest in Kohai Company is P1,080,000. Compute the amount of goodwill, using full-goodwill or fair value basis approach: O P480,000 O P360,000 O None of the given None
Senpai Company acquires 15% of Kohai Company's common stock for P600,000 cash and carries the investment using the cost model. A few months later, Senpai purchases another 60% of Kohai Company's stock for P2,592,000. At that date, Kohai Company reports identifiable assets with a book value of P4,680,000 and a fair value of P6,120,000, and it has liabilities with a book value and fair value of P2,280,000. The fair value of the 25% non-controlling interest in Kohai Company is P1,080,000. Compute the amount of goodwill, using full-goodwill or fair value basis approach: O P480,000 O P360,000 O None of the given None
Chapter10: Cost Recovery On Property: Depreciation, Depletion, And Amortization
Section: Chapter Questions
Problem 62P
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Transcribed Image Text:Senpai Company acquires 15% of Kohai Company's
common stock for P600,000 cash and carries the
investment using the cost model. A few months later,
Senpai purchases another 60% of Kohai Company's stock
for P2,592,000. At that date, Kohai Company reports
identifiable assets with a book value of P4,680,000 and a
fair value of P6,120,000, and it has liabilities with a book
value and fair value of P2,280,000. The fair value of the
25% non-controlling interest in Kohai Company is
P1,080,000.
Compute the amount of goodwill, using full-goodwill or
fair value basis approach:
O P480,000
O P360,000
O None of the given
None
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