Alex Ltd. Is taken over by Billy Ltd. On the following terms: The assets and liabilities of Alex Ltd, shall be valued at P3,000,000 and P1,000,000. P5,000 shall be paid in cash and the balance of consideration shall be discharged by issue of shares of P10 each at a premium of 50%. Show the Calculation of purchase consideration and state the number of shares issued to the shareholders of Alex Ltd.

Alex Ltd. Is taken over by Billy Ltd. On the following terms: The assets and liabilities of Alex Ltd, shall be valued at P3,000,000 and P1,000,000. P5,000 shall be paid in cash and the balance of consideration shall be discharged by issue of shares of P10 each at a premium of 50%. Show the Calculation of purchase consideration and state the number of shares issued to the shareholders of Alex Ltd.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Alex Ltd. Is taken over by Billy Ltd. On the following terms:
The assets and liabilities of Alex Ltd, shall be valued at P3,000,000 and P1,000,000.
P5,000 shall be paid in cash and the balance of consideration shall be discharged by issue of
shares of P10 each at a premium of 50%.
Show the Calculation of purchase consideration and state the number of shares issued to the
shareholders of Alex Ltd.

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