On January 31. 2022 Parent Company purchased al the identifiable net assets of Sub Company by transfenring cash of P1.200.000 and issuing 100.000 shares with par value of P20 and fair value of P32. Parent will pay additional amount depending on the net income achieved by Sub at year-end Net income e year end 50.000.000 75,000.000 Consideration to be transferred 1,000.000 2.000.000 3.000.000 Case 100,000.000 Book value of Parent and Sub edete of acquisition were as folows Parent 1,000.000 1.600.000 2,400.000 5.000 000 10,000.000 2,400.000 2.000.000 1,600.000 4.000.000 10,000.000 Cash 800.000 Accounts receivable 1.400.000 Inventory Buldings 800.000 2.800 000 5.800.000 Total assets Accounts payable Common stock P2 par Share premium Retained eamings Total kabes and equities 1,000.000 1.200.000 800.000 2.800 000 5.300.000 At the date of acquisition, Parent assessed that Sub will reach at least 60.000.000 of net income for 2022. Book value of the identifiable net assets of Sub on January 31, 2022 is P4800.000. Temporary appraisal at the date of acquisition is PS,000.000. On December 31, 2022 an additional valuation resuted to a decrease of PS00.000 trom previous appraisal and fair value of the net assets were finalized on February 6. 2023 by a subsequent increase of P1.000.000 from last valuation. Parent paid P100,000 business combination expenses, 25 are direct, 25 are share issue costs, and 15 are indirect costs. Net income of Sub at 1231/22 is PSOM.
On January 31. 2022 Parent Company purchased al the identifiable net assets of Sub Company by transfenring cash of P1.200.000 and issuing 100.000 shares with par value of P20 and fair value of P32. Parent will pay additional amount depending on the net income achieved by Sub at year-end Net income e year end 50.000.000 75,000.000 Consideration to be transferred 1,000.000 2.000.000 3.000.000 Case 100,000.000 Book value of Parent and Sub edete of acquisition were as folows Parent 1,000.000 1.600.000 2,400.000 5.000 000 10,000.000 2,400.000 2.000.000 1,600.000 4.000.000 10,000.000 Cash 800.000 Accounts receivable 1.400.000 Inventory Buldings 800.000 2.800 000 5.800.000 Total assets Accounts payable Common stock P2 par Share premium Retained eamings Total kabes and equities 1,000.000 1.200.000 800.000 2.800 000 5.300.000 At the date of acquisition, Parent assessed that Sub will reach at least 60.000.000 of net income for 2022. Book value of the identifiable net assets of Sub on January 31, 2022 is P4800.000. Temporary appraisal at the date of acquisition is PS,000.000. On December 31, 2022 an additional valuation resuted to a decrease of PS00.000 trom previous appraisal and fair value of the net assets were finalized on February 6. 2023 by a subsequent increase of P1.000.000 from last valuation. Parent paid P100,000 business combination expenses, 25 are direct, 25 are share issue costs, and 15 are indirect costs. Net income of Sub at 1231/22 is PSOM.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
46
Transcribed Image Text:On January 31. 2022. Parent Company purchased althe identifiable net assets of Sub Company by transferring cash of P1,200,000 and issuing 100,000 shares with
par value of P20 and fair value of P32. Parent will pay additional amount depending on the net income achieved by Sub at year-end:
Not income e year-end
50,000.000
75,000,000
Consideration to be transferred
1,000.000
2,000.000
3,000.000
Case
1
100,000.000
Book value of Parent and Sub at the date of acquisition were as folows:
Parent
1,000,000
1,600.000
2,400.000
5,000.000
10,000.000
2,400.000
2.000.000
1,600.000
Sub
800,000
1,400.000
Cash
Accounts receivable
Inventory
Buldings
Total assets
800.000
2.800 000
5,800.000
1,000.000
Accounts payable
Common stock P2 par
1,200.000
800.000
Share premium
Retained eamings
Total labilies and equities
2,800.000
5,000.000
4,000.000
10,000.000
At the date of acquisition, Parent assessed that Sub will reach at least 60.000.000 of net income for 2022. Book value of the identifiable net assets of Sub on
January 31, 2022 is P4,800,000. Temporary appraisal at the date of acquisition is P5,000,000. On December 31, 2022 an additional valuation resulted to a decrease
of P500.000 from previous appraisal and fair value of the net assets were finalized on February 6, 2023 by a subsequent increase of P1,000,000 from last valuation.
Parent paid P100,000 business combination expenses, 2/5 are direct, 25 are share issue costs, and 1/5 are indirect costs. Net income of Sub at 12/31/22 is PSOM.
Transcribed Image Text:how much is the goodwill to be reported on January 31, 2022?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education