Name Company, an SME, issued 120,000 shares of P25 par value ordinary shares for all the outstanding stock of 5 Company in business consummated on July 1, 2022. Name Company's ordinary shares were selling at P40 per share at the time of consummation of the combination. The book value of Name net assets was P3.8M. out of pocket costs of combination were as follows: (1) Legal fees for business combination - P12,000 (2) Legal fees for SEC registration - 14,500 (3) SEC registration costs - 18,200 (4) Printing costs of share certificates - 9,400 (5) Finder's fees - 27,000 (6) CPA audit fees for SEC registration in #3 - 19,000 Question: How much is the capitalized cost of investment?
Name Company, an SME, issued 120,000 shares of P25 par value ordinary shares for all the outstanding stock of 5 Company in business consummated on July 1, 2022. Name Company's ordinary shares were selling at P40 per share at the time of consummation of the combination. The book value of Name net assets was P3.8M. out of pocket costs of combination were as follows: (1) Legal fees for business combination - P12,000 (2) Legal fees for SEC registration - 14,500 (3) SEC registration costs - 18,200 (4) Printing costs of share certificates - 9,400 (5) Finder's fees - 27,000 (6) CPA audit fees for SEC registration in #3 - 19,000 Question: How much is the capitalized cost of investment?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Name Company, an SME, issued 120,000 shares of P25 par value ordinary shares for all the outstanding stock of 5 Company in business consummated on July 1, 2022. Name Company's ordinary shares were selling at P40 per share at the time of consummation of the combination.
The book value of Name net assets was P3.8M. out of pocket costs of combination were as follows:
(1) Legal fees for business combination - P12,000
(2) Legal fees for SEC registration - 14,500
(3) SEC registration costs - 18,200
(4) Printing costs of share certificates - 9,400
(5) Finder's fees - 27,000
(6) CPA audit fees for SEC registration in #3 - 19,000
Question: How much is the capitalized cost of investment?
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