On January 1, 2021, A Company acquired a 50% interest in B for P60,000,000.  A Company already held a 20% interest which had been acquired for P20,000,000 but which was valued at P24,000,000 at January 1, 2021.  The fair value of the NCI at January 1, 2021 was P30,000,000, and the fair value of the identifiable net assets of B was P110,000,000.  How much is the goodwill to be recognized as a result of the business combination?  * a. P 0 b. P 3,000,000 c. P 4,000,000 d. P 7,000,000

In the year ended June 30 2021, Lorelai Ltd, a reporting entity, acquired the assets and assumed the liabilities of the Rory Teens operation from Gilmore Ltd for $10,000,000. At the date of acquisition, the fair values of the net separable identifiable assets and liabilities of the operation were $8,000,000 and $1,000,000 respectively. Based on this information, the transaction has resulted in: O a. The acquisition of certain assets and liabilities, which is not a business combination since Rory Teens is not managed to provide a return to investors but only to provide a return to Gilmore Ltd. O b. None of these answers is correct. O c. The acquisition of certain assets and liabilities, which is not a business combination since Rory Teens is not a business but simply part of the Gilmore Ltd business. O d. A business combination of Lorelai Ltd and Rory Teens.

A5

On January 1, 2023, Flounder Corporation, a public company following IFRS, acquired 17,400 of the 58,000 outstanding common shares of Noah Corp. for $27 per share. Noah's statement of financial position reported the following information at the date of the acquisition: Assets not subject to depreciation $287,800 Assets subject to depreciation 863,600 Liabilities 148,600 Additional information: 1. On the acquisition date, the fair value is the same as the carrying amount for the assets that are not subject to depreciation and for the liabilities. 2. 3. 4. On the acquisition date, the fair value of the assets that are subject to depreciation is $957,600. These assets had a remaining useful life of eight years at that time. Noah reported 2023 net income of $94,000 and paid dividends of $4,500 in December 2023. Noah's shares are not actively traded on the stock exchange, but Flounder has determined that they have a fair value of $25 per share on December 31, 2023. (a) Prepare the journal…

6. On December 31, 2019, Stefan company purchased for 30 per share all 300,000 of Elena company’s outstanding ordinary shares. On this date, the acquiree’s statement of financial position showed net assets of P7,500,000. Additionally, the fair value of the acquiree’s identifiable assets on this date was 600,000 in excess of carrying amount. In the statement of financial position, what amount should be reported as goodwill as a result ofthe acquisition?

On 1 July 2019, Frankie Ltd acquired 80% of the issued shares of Sinatra Ltd for $250,000. At that date, Sinatra Ltd's equity consisted of share capital of $200,000 and retained earnings of $300,000. At acquisition date, all identifiable net assets of Sinatra Ltd were recorded at amounts equal to fair value. At 1 July 2019, the fair value of the non-controlling interest was $50,000. Required: (a) Calculate goodwill using the partial goodwill method. (b) Explain the reason why an adjustment is required to the NCI share of profit, for a non-current asset revalued to fair value at acquisition date.

On January 1, 2019, FFF Company acquired a 10% interest in an investee for P3,000,000. The investment was accounted for using the cost method. On January 1, 2020, the entity acquired a further 15% interest in the investee for P6,750,000. On such date, the carrying amount of the net assets of the investee was P36,000,000 and the fair value of the 10% interest was P4,500,000. The fair value of the net assets of the investee is equal to carrying amount except for an equipment whose fair value exceeds carrying amount by P4,000,000. The equipment has a remaining life of 5 years. The investee reported net income of P8,000,000 for 2020 and paid cash dividend of P5,000,000 on December 31, 2020. What amount of gain on re-measurement to equity should be recognized in 2020?