Octane Company and Bio Company have announced terms or an exchange agreement under which Octane will issue 10,000 shares or its P5 par value ordinary shares to acquire all of Bio's assets. Octane's shares are trading at P28. and Bio's P10 par value shares are trading at P15. financial position data on January 1, 2008, are as follows: Historical cost and fair value statement of Octane Company Вook Bio Company Fair Value Fair Value Вook Cash Value Value P 125,000 P 125,000 P 25,000 120,000 en40,000 50,000 Land 75,000 30,000 Buildings and Equipment (net) Total Assets 180,000 P 380,000 220,000 120,000 150,000 P 175,000 Ordinary Shares Share Premium P 150,000 60,000 P 100,000 20,000 Retained earnings Total 170,000 P 380,000 55,000hot lesraiM P 175,000 .000,011 4) Başed on the information provided, what amount will be reported for Ordinary Share in the combined company's statement of financial position immediately following the business combination? a. 200,000 b. 205,000 C. 210,000 d. 215,000 o nommo ptoy 5) Based on the information provided, what amount will be reported for Shareholders' Equity in the combined company's statement of financial position immediately following the business combination? a. 660,000 b. 665,000 c. 670,000 d. 685,000 000 00 oration holds assets with a fair value of P150,000 and a Inilitior with a book value and fair
Octane Company and Bio Company have announced terms or an exchange agreement under which Octane will issue 10,000 shares or its P5 par value ordinary shares to acquire all of Bio's assets. Octane's shares are trading at P28. and Bio's P10 par value shares are trading at P15. financial position data on January 1, 2008, are as follows: Historical cost and fair value statement of Octane Company Вook Bio Company Fair Value Fair Value Вook Cash Value Value P 125,000 P 125,000 P 25,000 120,000 en40,000 50,000 Land 75,000 30,000 Buildings and Equipment (net) Total Assets 180,000 P 380,000 220,000 120,000 150,000 P 175,000 Ordinary Shares Share Premium P 150,000 60,000 P 100,000 20,000 Retained earnings Total 170,000 P 380,000 55,000hot lesraiM P 175,000 .000,011 4) Başed on the information provided, what amount will be reported for Ordinary Share in the combined company's statement of financial position immediately following the business combination? a. 200,000 b. 205,000 C. 210,000 d. 215,000 o nommo ptoy 5) Based on the information provided, what amount will be reported for Shareholders' Equity in the combined company's statement of financial position immediately following the business combination? a. 660,000 b. 665,000 c. 670,000 d. 685,000 000 00 oration holds assets with a fair value of P150,000 and a Inilitior with a book value and fair
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Octane Company and Bio Company have announced terms of an
Octane Company and Bio Company have announced terms of a
exchange agreement under which Octane will issue 10,000 shares
or Its P5 par value ordinary shares to acquire all of Bio's assets.
Octane's shares are trading at p28. and Bio's P10 par value shares
are trading at P15. Historical cost and fair value statement of
financial position data on January 1, 2008, are as follows:
Octane Company
Book
Bio Company
Fair Value
Book
Value
Fair
Value
10
P 25,000 40,000
30,000 50,000
Value
Cash
P 125,000 P 125,000
75,000
Land
120,000
Buildings and
Equipment (net)
Total Assets
180,000
P 380,000
220,000 120,000 150,000
P 175,000
Ordinary Shares
Share Prenium
P 100,000
P 150,000
bloa 60,000
SvIsunt 20,000 lends
odd 6 be
Retained
earnings
Total
000
170,000
P 380,000
55,000
P 175,000
.000,011
4) Başed on the information provided, what amount will be reported
for Ordinary Share in the combined company's statement of
financial position immediately following the business combination?
a. 200,000
b. 205,000
c, 210,000
d. 215,000b02 nom
5) Based on the information provided, what amount will be reported
for Shareholders' Equity in the combined company's statement of
financial position immediately following the business combination?
P.31800
nwo on
55 500
00,00
a, 660,000
b. 665,000
c. 670,000
d. 685,000
000.00
oration holds assets with a fair value of P150,000 and a
with a book value and fair
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