Book Value Fair Value 50,000 P 500,000 1,000,000 Cash 50,000 500,000 1,500,000 250,000 3,000,000 Accounts receivable Inventory Patent Property, plant and equipment 2,000,000 In addition, the acquired entity had liabilities totaling P2,000,000 at the time of acquisition. The acquired entity has no other separately identifiable intangible asset
Book Value Fair Value 50,000 P 500,000 1,000,000 Cash 50,000 500,000 1,500,000 250,000 3,000,000 Accounts receivable Inventory Patent Property, plant and equipment 2,000,000 In addition, the acquired entity had liabilities totaling P2,000,000 at the time of acquisition. The acquired entity has no other separately identifiable intangible asset
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Coronation company purchased an entity for 6,000,000 cash on January 31. The book value and fair value of the assets of the acquired entity as of the date of acquisition of follow:
Question: What is the good arising from the acquisition?
A. 4,450,000
B. 700,000
C. 2,450,000
D. 2,700,000
Transcribed Image Text:Book Value
Fair Value
50,000
500,000
Cash
50,000 P
500,000
Accounts receivable
Inventory
1,000,000
1,500,000
250,000
3,000,000
Patent
Property, plant and equipment
2,000,000
In addition, the acquired entity had liabilities totaling P2,000,000 at the time of the
acquisition. The acquired entity has no other separately identifiable intangible assets.
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