Summary information is given for SBMA, Inc. and PCIB Company at July 1, 2016.The quoted market price of SBMA and PCIB shares are P36 and P40, respectively.SBMA and PCIB are both SMES.SBMA, Inc.Book value Fair value Book value Fair valuePCIB CompanyP 8,000,000P 9,000,000P24,000,000P24,000,00022,000,000 26,000,000 26,000,000 25,000,000P30,000,000P35,000,000P50,000,000P49,000,0005,000,000 5,000,00015,000,00015,500,00020,000,0003,000,00012,000,000P50,000,000Current assetsPlant assetsTotalsLiabilitiesCommon stocks, P10 par10,000,000ΑΡICRetained earnings_14,000,000Totals1,000,000P30,000,000PCIB Company acquires all the net assets of SMBA by issuing 1,000,000 of its ownshares. PCIB Company incurred the following out of pocket costs relating to theacquisition.Legal fees to arrange business combinationCost of SEC registrationCost of printing and issuing new stock certificatesIndirect cost of combinationP25,00012,0003,00020,00035,000Finder's fees42. Calculate the goodwill from the business combination.A. P10,000,000B. P10,025,000C. P10,040,000D. P10,060,000

Total purchase consideration = (No. of shares issued x quoted market price) = (100000 shares x P40)…

Answered: Summary information is given for SBMA,…

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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White Corporation provided you with the following summary of total assets and liabilities at January 1, 2021 and at December 31, 2021.Assets, January 1, 2021 - P9,000,000Assets, December 31, 2021 - P12,000,000Liabilities, January 1, 2021 - P3,200,000Liabilities, December 31, 2021 - P4,500,000During 2021, the company issued 10,000 shares of its P100 par ordinary share at P150 per share and declared dividends of P280,000. There were no other changes affecting the equity accounts. How much is White Corporation’s profit for the year 2021?
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