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The following balances were taken from the trial balance of CARDO Company and SYANO Company at the start of the fiscal year 20x7: CARDO COMPANY Book Value Fair Value Book Value Fair Value Cash P500,000 250,000 Accounts Payable P450,000 200,000 595,000 260,000 P440,000 220,000 P500,000 240,000 Mortgage Payable 200,000 Ordinary Shares 520,000 Retained Earnings Accounts Receivable Inventory Fixed Assets (Net) 155,000 600,000 SYANO COMPANY Book Value Fair Value Book Value Fair Value Cash P300,000 150,000 125,000 400,000 P300,000 Accounts Payable 160,000 Mortgage Payable 100,000 Ordinary Shares 420,000 Retained Earnings P350,000 200,000 250,000 175,000 P340,000 220,000 Accounts Receivable Inventory Fixed Assets (Net) RS

The following balances were taken from the trial balance of CARDO Company and SYANO Company at the start of the fiscal year 20x7: CARDO COMPANY Book Value Fair Value Book Value Fair Value Cash P500,000 250,000 Accounts Payable P450,000 200,000 595,000 260,000 P440,000 220,000 P500,000 240,000 Mortgage Payable 200,000 Ordinary Shares 520,000 Retained Earnings Accounts Receivable Inventory Fixed Assets (Net) 155,000 600,000 SYANO COMPANY Book Value Fair Value Book Value Fair Value Cash P300,000 150,000 125,000 400,000 P300,000 Accounts Payable 160,000 Mortgage Payable 100,000 Ordinary Shares 420,000 Retained Earnings P350,000 200,000 250,000 175,000 P340,000 220,000 Accounts Receivable Inventory Fixed Assets (Net) RS

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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If CARDO Co purchases the net assets of SYANO Co by issuing 4,000 shares of their P10 par value shares with a fair value of P35 per share, a P40,000 direct cost and a P50,000 stock issue cost however remain unpaid. The companies also agreed on the following:  CARDO guarantees the prices of there stocks and promises to pay the peso decline in their shares within one year.  CARDO Co promises to pay the stockholders of SYANO Co an additional P100,00 if the net income of the company in the next year will be more than P500,000. CARDO estimates that there is an 80% probability of achieving the target income.

compute for the consolidated total equity at the date of acquisition

The following balances were taken from the trial balance of CARDO Company and SYANO Company at the start of the fiscal year 20x7: CARDO COMPANY Book Value Fair Value Book Value Fair Value Cash Accounts Receivable Accounts Payable P450,000 200,000 P500,000 250,000 155,000 600,000 P500,000 240,000 Mortgage Payable 200,000 Ordinary Shares 520,000 Retained Earnings P440,000 220,000 LO 595,000 260,000 Inventory Fixed Assets (Net) SYANO COMPANY Book Value Fair Value Book Value Fair Value Accounts Payable P350,000 200,000 250,000 175,000 P340,000 220,000 Cash P300,000 150,000 125,000 400,000 P300,000 160,000 Mortgage Payable 100,000 Ordinary Shares 420,000 Retained Earnings Accounts Receivable Inventory Fixed Assets (Net) RS
Transcribed Image Text:The following balances were taken from the trial balance of CARDO Company and SYANO Company at the start of the fiscal year 20x7: CARDO COMPANY Book Value Fair Value Book Value Fair Value Cash Accounts Receivable Accounts Payable P450,000 200,000 P500,000 250,000 155,000 600,000 P500,000 240,000 Mortgage Payable 200,000 Ordinary Shares 520,000 Retained Earnings P440,000 220,000 LO 595,000 260,000 Inventory Fixed Assets (Net) SYANO COMPANY Book Value Fair Value Book Value Fair Value Accounts Payable P350,000 200,000 250,000 175,000 P340,000 220,000 Cash P300,000 150,000 125,000 400,000 P300,000 160,000 Mortgage Payable 100,000 Ordinary Shares 420,000 Retained Earnings Accounts Receivable Inventory Fixed Assets (Net) RS
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