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SG Company purchased 35% interest in Popsters Company for P5,600,000 on July 15, 2020. SG already held a 25% interest purchased for P3,000,000. As of this date, the carrying value of the identifiable net assets of Popsters totaled P17,000,000. The carrying value of the identifiable net assets of Popsters equal their fair values except for the undervaluation of Inventories and Machineries by P400,000 and P1,000,000 respectively. Business combination is between SMES. How much is the goodwill/(gain on bargain purchase) arising from the combination? * O

SG Company purchased 35% interest in Popsters Company for P5,600,000 on July 15, 2020. SG already held a 25% interest purchased for P3,000,000. As of this date, the carrying value of the identifiable net assets of Popsters totaled P17,000,000. The carrying value of the identifiable net assets of Popsters equal their fair values except for the undervaluation of Inventories and Machineries by P400,000 and P1,000,000 respectively. Business combination is between SMES. How much is the goodwill/(gain on bargain purchase) arising from the combination? * O

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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SG Company purchased 35% interest in Popsters Company for P5,600,000 on July 15, 2020. SG already held a 25% interest purchased for P3,000,000. As of this date, the carrying value of the identifiable net assets of Popsters totaled P17,000,000. The carrying value of the identifiable net assets of Popsters equal their fair values except for the undervaluation of Inventories and Machineries by P400,000 and P1,000,000 respectively. Business combination is between SMES. How much is the goodwill/(gain on bargain purchase) arising from the combination? * G
Transcribed Image Text:SG Company purchased 35% interest in Popsters Company for P5,600,000 on July 15, 2020. SG already held a 25% interest purchased for P3,000,000. As of this date, the carrying value of the identifiable net assets of Popsters totaled P17,000,000. The carrying value of the identifiable net assets of Popsters equal their fair values except for the undervaluation of Inventories and Machineries by P400,000 and P1,000,000 respectively. Business combination is between SMES. How much is the goodwill/(gain on bargain purchase) arising from the combination? * G
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