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    Practice Set 2 Abc

    Uploaded by

    Diana Rose Bassig
    The document provides information about three business combination case studies involving the acquisition of shares of Solo Corporation by Polo Corporation, Honda Corporation shares by Ford Company, and AUDI Company shares by BMW Company. It includes financial information for the acquiring and acquired companies and poses calculation questions related to the measurement of goodwill, allocated excess, and gain or loss on additional shares acquired for each case study.

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    Practice Set 2 Abc

    Uploaded by

    Diana Rose Bassig
    219 views1 page
    The document provides information about three business combination case studies involving the acquisition of shares of Solo Corporation by Polo Corporation, Honda Corporation shares by Ford Company, and AUDI Company shares by BMW Company. It includes financial information for the acquiring and acquired companies and poses calculation questions related to the measurement of goodwill, allocated excess, and gain or loss on additional shares acquired for each case study.

    Original Title

    PRACTICE_SET_2_ABC

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    The document provides information about three business combination case studies involving the acquisition of shares of Solo Corporation by Polo Corporation, Honda Corporation shares by Ford Company, and AUDI Company shares by BMW Company. It includes financial information for the acquiring and acquired companies and poses calculation questions related to the measurement of goodwill, allocated excess, and gain or loss on additional shares acquired for each case study.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    219 views1 page

    Practice Set 2 Abc

    Uploaded by

    Diana Rose Bassig
    The document provides information about three business combination case studies involving the acquisition of shares of Solo Corporation by Polo Corporation, Honda Corporation shares by Ford Company, and AUDI Company shares by BMW Company. It includes financial information for the acquiring and acquired companies and poses calculation questions related to the measurement of goodwill, allocated excess, and gain or loss on additional shares acquired for each case study.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    PRACTICE SET 2- BUSINESS COMBINATION

    1. The January 1, 2017 Statement of Financial Position of Solo Corporation at book or market values were as
    follows:

    Book Value Fair Value


    Current Assets 1,200,000 1,125,000
    PPE 1,350,000 1,500,000
    Current Liabilities 450,000 450,000
    Long Term Liabilities 750,000 690,000
    Common Stock 150,000
    APIC 300,000
    Retained Earnings 900,000

    Polo Corporation paid 1,425,000 cash for 80% of Solo Corporation’s Common Stock.

    A. IF THE FAIR VALUE OF NCI IS ASSESSED TO BE 345,000:


    a. How much is the allocated excess?
    b. How much us the full goodwill?
    c. How much is the partial goodwill?
    d. How much is the goodwill from acquisition is attributable to parent?
    e. How much is the goodwill from acquisition attributable to NCI?
    B. IF THE FAIR VALUE OF THE NCI IS ASSESSED TO BE 295,000
    a. How much is the allocated excess?
    b. How much is the total goodwill attributable to parent?
    c. How much is the total goodwill attributable to NCI?
    C. IF THERE IS NO AVAILABLE FAIR VALUE OF NCI
    a. How much is the allocated excess?
    b. How much is the full goodwill?
    c. How much is the partial goodwill/
    d. How much is the total goodwill attributable to parent?
    e. How much is the total goodwill attributable to NCI?
    2. On June 1, 2016, Ford Company acquired 80% (800,000 shares) of Honda Corporation forn8,400,000. A
    control premium of 400,000 is included in the consideration paid by Ford. The carrying and fair value if Net
    Identifiable Assets of Honda amounted to 8,000,000 and 9,500,000 respectively.
    a. How much is the amount of goodwill under proportionate share basis or partial goodwill?
    b. How much is the amount of goodwill under fair value basis or full goodwill?
    c. Assume that the Fair Value off NCI is assessed at 1,950, how much is the amount of goodwill under
    gross up value basis?
    3. On January 5, 2016, BMW Company acquires 10% of AUDI Company’s common stock for 500,000 cash
    and carries the investment as a fair value through OCI investment. On March 3, 2016, BMW purchases
    additional 70 % of AUDI Company’s common stock for 3,780,000. At that date, AUDI Company reports
    identifiable asset with book value and fair value of 5,900,000 and 7,300,000. When the Liabilities with a
    book value of 2,600,000. The fair value of NCI is 950,000.
    a. How much is the fair value of Net assets of Subsidiary?
    b. How much is the allocated excess?
    c. How much is the amount of gain or loss recognized due to additional shares acquired?
    d. How much is the full goodwill?
    e. How much is the proportionate goodwill?

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