11. On May 31,2020, Genesis Company has assets and liabilities with the following fair values: Current Assets -P180,000; Non-Current Assets- P220,000; Liabilities - P40,000. On June 1, 2020, Judges Corporation purchased the net assets of Genesis for P310,000 cash. In the books of Judges, the acquisition resulted to: a. Gain recognized in the P/L amounting to P50,000 b. Goodwill recognized in the balance sheet amounting to 50,000 c. Gain recognized in the OCI amounting to P50,000 d. Decrease in current assets of P50,000
11. On May 31,2020, Genesis Company has assets and liabilities with the following fair values: Current Assets -P180,000; Non-Current Assets- P220,000; Liabilities - P40,000. On June 1, 2020, Judges Corporation purchased the net assets of Genesis for P310,000 cash. In the books of Judges, the acquisition resulted to: a. Gain recognized in the P/L amounting to P50,000 b. Goodwill recognized in the balance sheet amounting to 50,000 c. Gain recognized in the OCI amounting to P50,000 d. Decrease in current assets of P50,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:11. On May 31,2020, Genesis Company has assets and liabilities with the following fair values:
Current Assets -P180,000; Non-Current Assets- P220,000; Liabilities- P40,000.
On June 1, 2020, Judges Corporation purchased the net assets of Genesis for P310,000
cash. In the books of Judges, the acquisition resulted to:
a. Gain recognized in the P/L amounting to P50,000
b. Goodwill recognized in the balance sheet amounting to 50,000
c. Gain recognized in the OCI amounting to P50,000
d. Decrease in current assets of P50,000
Riverdale paid finder's fees of P40,000, legal fees of P13,000, audit fees related to the stock
issuance of P10,000, stock registration fees of P5,000, and stock listing application fees of
P4,000.
Based on the preceding information, under the acquisition method, what amount relating
to the business combination would be expensed?
a. P19,000
b. P53,000
c. P63,000
d. P72,000
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