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    M 202

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    Rafael Capunpon Vallejos
    MY LOVES Corporation borrowed P160,000 to purchase 80% of SWEETIE Incorporated. The total assets amount to be recorded on the consolidated statement of financial position at July 1, 2023 is P1,151,000.

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    M 202

    Uploaded by

    Rafael Capunpon Vallejos
    148 views2 pages
    MY LOVES Corporation borrowed P160,000 to purchase 80% of SWEETIE Incorporated. The total assets amount to be recorded on the consolidated statement of financial position at July 1, 2023 is P1,151,000.

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    MY LOVES Corporation borrowed P160,000 to purchase 80% of SWEETIE Incorporated. The total assets amount to be recorded on the consolidated statement of financial position at July 1, 2023 is P1,151,000.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    148 views2 pages

    M 202

    Uploaded by

    Rafael Capunpon Vallejos
    MY LOVES Corporation borrowed P160,000 to purchase 80% of SWEETIE Incorporated. The total assets amount to be recorded on the consolidated statement of financial position at July 1, 2023 is P1,151,000.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    On July 1, 2023, MY LOVES Corporation borrowed P160,000 to purchase 80% of the outstanding

    common shares of SWEETIE Incorporated. This loan, carrying a 12% annual rate, is payable in 10
    annual instalments beginning July 1, 2023. The summary of MY LOVES’ and SWEETIE’s statement
    of financial position as of June 30, 2023, are as follows (all amounts are in Philippine Peso): MY
    LOVES SWEETIE Total Assets 800,000 300,000 Total Liabilities 250,000 155,000 Total
    Shareholders' Equity 550,000 145,000 The book value of SWEETIE’s assets and liabilities
    approximated market values except for accounts payable, which had a fair value that was P5,000
    more than the book value. Any remaining difference is attributable to goodwill. The amount to be
    recorded on the consolidated statement of financial position at July 1, 2023, for total assets is:

    Group of answer choices

    P1,151,000

    P1,100,000

    P1,100,000

    P1,160,000

    Octane Company and Bio Company have announced terms of an exchange agreement under which
    Octane will issue 10,000 shares of its P5 par value ordinary shares to acquire all of Bio's assets.
    Octane shares are trading at P28, and Bio's P10 par value shares are trading at P15. Historical cost
    and fair value balance sheet data on January 1, 2016, are as follows: Octane Company Bio Company
    Book Value Fair Value Book Value Fair Value Cash 125,000 125,000 25,000 40,000 Land 75,000
    120,000 30,000 50,000 Buildings and Equipment 180,000 220,000 120,000 150,000 TOTAL
    ASSETS 380,000 465,000 175,000 240,000 Ordinary Share Capital 150,000 100,000 Share Premium
    60,000 20,000 Retained Earnings 170,000 55,000 TOTAL EQUITIES 380,000 175,000 Based on the
    information provided, what amount will be reported immediately following the business combination
    for Buildings and Equipment (net) in the combined company's statement of financial position?

    Group of answer choices

    P330,000

    P370,000

    P340,000

    P300,000

    Balance sheet information for Hope Corporation at January 1, 20x4, is summarized as follows:
    Current assets …… P 920,000 Liabilities ……................ P 1,200,000 Plant asset ………... 1,800,000

    1
    Capital stock P10 par…. 800,000 Retained earnings……... 720,000 --------------------
    --------------------- P 2,720,000 P 2,720,000 Hope’s assets and liabilities are fairly valued except for
    plant assets that are undervalued by P200,000. On January 2, 20x4, Robin Corporation issues 80,000
    shares of its P10 par value common stock for all of Hope’s net assets and Hope is dissolved. Market
    quotations for the two stocks on this date are: Robin common: P28 Hope common: P19 Robin pays
    the following fees and costs in connection with the combination: Finder’s fee, P10,000 Costs of
    registering and issuing stock, P5,000 Legal and accounting fees, P6,000 Calculate the amount of
    consideration transferred:

    Group of answer choices

    P 390,000

    P 85,000

    P2,240,000

    P 475,000

    Octane Company and Bio Company have announced terms of an exchange agreement under which
    Octane will issue 10,000 shares of its P5 par value ordinary shares to acquire all of Bio's assets.
    Octane shares are trading at P28, and Bio's P10 par value shares are trading at P15. Historical cost
    and fair value balance sheet data on January 1, 2016, are as follows: Octane Company Bio Company
    Book Value Fair Value Book Value Fair Value Cash 125,000 125,000 25,000 40,000 Land 75,000
    120,000 30,000 50,000 Buildings and Equipment 180,000 220,000 120,000 150,000 TOTAL
    ASSETS 380,000 465,000 175,000 240,000 Ordinary Share Capital 150,000 100,000 Share Premium
    60,000 20,000 Retained Earnings 170,000 55,000 TOTAL EQUITIES 380,000 175,000 Based on the
    information provided, what amount will be reported for Ordinary Share Capital in the combined
    company's statement of financial position immediately following the business combination?

    Group of answer choices

    P210,000

    P300,000

    P200,000

    P250,000

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