15.The VV Company will issue shares of P10 par value common stock for all theassets and liabilities of the NN Company. VV Company's common stock has acurrent market value of P40 per share. The NN Company's Statement offinancial position prior to acquisition is shown below:320,000Current AssetsLiabilities400,000PPE (net)880,000Common Stock, P4 par80,000Total Assets1,200,000APIC320,000Retained EarningsTotal Equity400,0001,200,000The fair market value of the current assets is 400,000 while that of the PPEis 1,600,000. All the liabilities are correctly stated VV Company issuedsufficient shares of stock so that the fair market value of the stock isued isequal the fair market value NN Company's net assets.To have an income from acquisition of 100,000, the number of shares to beissued by VV Company should be:C. 42,500A. 37,500B. 37,000D. 42,000

When a Company is acquired by another company, Net assets are taken at fair value.

5.The VV Company will issue shares of P10 par value c assets and liabilities of the NN Company. W Compan current market value of P40 per share. The NN C financial position prior to acquisition is shown below: Current Assets 320,000 Liabilities PPE (net) 880,000 Common Sto Total Assets 1,200,000 APIC Retained Earı

5.The VV Company will issue shares of P10 par value c assets and liabilities of the NN Company. W Compan current market value of P40 per share. The NN C financial position prior to acquisition is shown below: Current Assets 320,000 Liabilities PPE (net) 880,000 Common Sto Total Assets 1,200,000 APIC Retained Earı

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Give typing answer with explanation and conclusion
9. KUNG AKO NA LANG SANA Company acquired land and building with fair value of P3,500,000 by issuing 30,500 shares with par value of P15 per share and quoted price of P75 per share. What is the initial cost of the land? A. 457,500 B. C. 1,800,000 D. 3,500,000 2,287,500 10. MR. Co. a VAT-registered business, acquired a piece of equipment for P84,000 on account. The purchase is inclusive of 12% VAT. The credit term for this transaction is 1/10, n30, but MR. Co. did not avail of the discount. MR. Co. also incurred P45,250 cost of training the personnel who will be operating the equipment and installation cost of P10,250. After one month, MR. Co. decided to redeploy the equipment to another location. MR. Co. incurred P10,500 in the relocation and reinstallation. The cost of the equipment is D. 94,910 A. 74,160 B. 119,410 C. 84,410
The investment accounts maintained by Dexter Company were shown below: Available for Sale Securities - Y Company Ordinary Date Particulars 01-01-2020 Beginning Balance, 3,000 shares 36,000 01-12-2020 2 for 1 share split ( market price after the share split is P7) 12,000 03-17-2020 Sold 1,000 shares at P8 8,000 10-01-2020 Purchased 2,000 additional shares of Y Ordinary at P8 per share plus transaction costs of P0.50 per share 17,000 11-30-2020 Sold 1,000 shares at P8.50 8,500 12-31-2020 Adjustment to fair value (FV is P9.20 per share.) 6,700 Financial Assets at Fair Value through Profit or Loss 0 B Company 06-30-2020 Received a dividend of 1 share of B Company ordinary for every 5 shares of Y Company Ordinary. Market price on this date of B Company Ordinary is P2.50. The shares have par value of P1. 1,000 09-10-2020 Sold 500 shares for P2.80 per share 1,400 12-31-2020 Adjustment to market; fair value is P3.20 per share 2,000 Additional Information: • You traced the…
Answer the question assuming that the preference share capital of Love Company are non-cumulative.
H1. Account
ABC SAOG acquired land worth OMR 80,000 from CPD LLC and issued 70,000 equity shares of OMR1 as fully paid up. Which one of the following journal entry will be correct? a. Debit Share capital 80,000, Credit Land OMR 70,000 Credit Share Premium OMR 10,000 b. Debit Land OMR 80,000 Credit Share Capital OMR 80,000 c. Debit Land OMR 80,000 Credit Share capital OMR 70,000 Credit Share premium OMR 10,000 d. Debit Land OMR 70,000, Debit Share Premium OMR 10,000 Credit Share Capital OMR 80,000 The total Sales revenue of XYZ SAOG in Oman was OMR 3 million opening inventory was OMR 500,000, Its Purchase cost is OMR 1,500,000, Distribution cost was OMR 500,000 and General and Administration expense was OMR 200,000, Closing inventory was OMR 300,000. The value of Gross Profit was a. OMR 1,700,000 b. OMR 1,800,000 c. OMR 600,000 d. OMR 1,300,000
The ABC Company will issue shares of P 20 par value common stock for all the assets and liabilities of XYZ Company. ABC Company’s common stock has a current price of P 40 per share. The fair market value of the current assets of XYZ is P 800,000, while that of the PPE is P 3,200,000. The liabilities are 600,000. To have a gain from acquisition of P200,000 the amount of shares to be issued by ABC Company should be : 75,000 74,000 85,000 80,000
Grace Inc. purchase Charm Inc. Their condensed balance sheets before combination show: Grace Charm Book Value Fair ValueASSETS 14,000,000 1,750,000 1,900,000Liabilities 9,975,000 614,000Ordinary Share, P100 par 5,250,000 875,000Share Premium 436,000Retained Earnings (deficit) -1,225,000 -175,000Liabilities and SHE 14,000,000 1,750,000 Grace issued its own debt and equity securities as a consideration for the net identifiable asset of Charm. Grace incurred P50,000 in issuing its P600,000 par bonds and P60,000 in issuing its P500,000 par shares of stock. Grace bonds is currently selling at 97 while its share of stock is at 120. How much is the total…
Kay Leni Tayo issue 50,000 of its P5 par value common stock for the net assets of AngatBuhay. AngatBuhay's trial balance at the date of acquisition shows the following: Current Assets 420,000 PPE 980,000 Liabilities 500,000 Common Stock 180,000 APIC 320,000 Retained Earnings 400,000 AngatBuhay's current assets are appraised at P550,000 and the PPE was also appraised at P1,800,000. Accordingly, Kay Leni Tayo issued common stock with the total market value equal to AngatBuhay's net assets including goodwill of P200,000. What is the market value per share of Kay Leni Tayo's share at the time of business combination?
Statement of Affairs of Gongcha Corp.:Assets pledged with fully secured liabilities (fair market value P75,000), P90,000Assets pledged with partially sec. Liabilities (fair market value P52,000), 74,000Free assets (current fair value P30,000), 70,000Unsecured liabilities with priority, 7,000Fully secured liabilities, 30,000Partially secured liabilities, 60,000Unsecured liabilities without priority, 112,000How much is the deficiency to unsecured non-priority?
q4
2. The Statement of Financial Position (SFP) of Arthur Corporation on June 30, 202X is presented below: Current Assets P195,000 1,320,000 660,000 525,000 P2,700,000 Land Building Equipment Total Assets Liabilities Ordinary Shares, P5 par Share Premium Retained Earnings Total Equities P525,000 900,00 825,000 450,000 P2,700,000 All the assets and liabilities of Arthur were assumed to approximate their fair values except for land and building. It is estimated that the land has a fair value of P2,100.000. and the fair value of the building increased by P480,000. Ezekeil Corporation acquired 80% of Arthur's outstanding shares for P3,000.000 The non-controlling interest is measured at fair value. Required: a. Determine the goodwill or gain on bargain purchase assuming the consideration paid includes control premium of P852,000. b. Determine the goodwill or gain on bargain purchase assuming the consideration paid excludes control premium of P138.000 and the fair value of the non-controlling…