ABC Inc. filed a petition for insolvency. The trustee provided the following information about the company's statement of affairs. Book value Estimated realizable value Assets: Cash 160,000 160,000 Accounts receivable 800,000 600,000 Inventorics 1,200,000 560,000 Equipment 2,000,000 2,240,000 Liabilities: Unsecured with priority Unsecured without priority Partially secured (secured by accounts receivable) Fully secured (secured by equipment) 640,000 1,200,000 800,000 1,760,000
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- On January 1, 2021, ABC acquired all the assets and assumed all the liabilities of DEF Co. for P4,500,000. Relevant information follows: ASSETS Fair Values 55,000 800,000 180,000 750,000 4,000,000 200,000 1,555,0000 Carrying Value 55,000 800,000 Cash Receivable Allowance for Doubtful Accounts Inventory Land Goodwill Liabilities 150,000 700,000 3,500,000 150,000 1,555,000 DEC Co. has research and development projects with fair value of P100,000. ABC does not intend to use those R&Ds. However, there have been exchange transactions involving the information generated from DEF, but those transactions are infrequent. > All fair value adjustments result to temporary differences but do not affect the tax bases of the assets and liabilities. The tax rate is 30%. > ABC incurred P200,000 on general administrative costs of maintaining an internal acquisition department. Compute the goodwill (gain on bargain purchase)?An SME provided the following on December 31, 2022: Cash Accounts receivable Prepayments Inventories Investment in associate Property, plant and equipment Accumulated depreciation and impairment Software - net of amortization and impairment Deferred tax asset Bank overdraft Bank loan, fully payable in 2022 and prepayable without penalty Trade payables Interest payable Current tax liability Provision for warranty. Employee benefit obligation, current portion, P4,000 Finance lease liability, current portion, P20,000 Share capital Retained earnings 5. What is the total amount of current assets? A. 675,000 B. 615,000 C. 785,000 D. 725,000 6. What is the total amount of current liabilities? A. 810,000 B. 860,000 C. 786,000 D. 806,000 7. What is the total shareholders' equity? A. 2,460,000 B. 2,400,000 C. 2,430,000 D. 2,700,000 25,000 530,000 60,000 60,000 110,000 3,250,000 700,000 10,000 5,000 80,000 50,000 430,000 2,000 270,000 4,000 10,000 44,000 30,000 2,430,000The statement of realization and liquidation of Honesty Co. are as follows: P1,700,000 Liabilities not liquidated Liabilities assumed Assets to be realized Assets acquired Assets realized Assets not realized Liabilities liquidated 300,000 1,100,000 1,200,000 1,600,000 Liabilities to be liquidated Supplementary charges Supplementary credits P1,400,000 1,500,000 2,000,000 2,500,000 1,950,000 What is the beginning balance of cash account assuming that Ordinary Share Capital is P1,500,000 and deficit, ending is P400,000?
- The Walston Company is to be liquidated. It has the following liabilities: Income taxes Notes payable (secured by land) Accounts payable Salaries payable (evenly divided between two employees) Bonds payable Administrative expenses for liquidation The company has the following assets: $ 7,600 136,000 93,000 14,000 78,000 28,000 Book Value Fair Value Current assets $ 88,000 Land 108,000 Buildings and equipment 108,000 $ 43,000 98,000 132,000 Required: How much money will the holders of the notes payable collect following liquidation? Total amount collectedpresent in good accounting form When AAA Company filed for liquidation with the Securities and Exchange Commission, it prepared the following statement of financial position: Current Assets (net realizable value, P50,000) P 80,000 Land and Building (fair value, P240,000) 200,000 Goodwill (fair value, 0) 40,000 Total Assets P320,000 Accounts Payable P160,000 Mortgage Payable (secured by land & building) 200,000 Ordinary share 100,000 Accumulated profits (140,000) Total Liabilities and Equity P320,000 What percentage of their claims are the unsecured creditors…A Company recently petitioned for bankruptcy and is now in the process of preparing a statement of affairs. The carrying values and estimated fair values at the assets pl the company are as follows: Carrying Value Fair Value Cash P8,000 P8,000 Accounts Receivable. 18,000. 12,000 Inventory 24,000 14,000 Land 30,000 28,000 Building(net). 72,000. 40,000 Equipment(net) 68,000. 32,000 Debts of the company are as follows: Accounts Payable P24,000 Wages Payable (all have priority) 4,000 Taxes Payable 4,000 Notes Payable (secured by receivable and building) 48,000 Interest on Notes Payable 2,400 Bonds Payable (secured by receivable and building)60,000 Interest on Bonds payable 2,800 Total 145,200 1.…
- SPK NOW Company owned the following investments at year-end before fair value adjustments and amortization: FA@FVTPL, P 600,000; FA@FVTOCI, P350,000; FA@AC, P470,000. What total amount of noncurrent assets related to the investments should be reported at year-end? a.P950,000 b.P1,420,000 c. P470,000 d. P820,000Action, Inc. acquired the following assets and assumed the related liabilities of Slacker Corp. in a transaction completed on February 16, 2023: Accounts receivable, net Inventories Property, plant & equipment Non-amortizable intangible assets Carrying value for Slacker Current liabilities Noncurrent liabilities $ 11,000 $ 50,000 $ 100,000 $ 200,000 Fair Value $ 10,000 $ 50,000 $ 150,000 $ 225,000 $ (40,000) $(200,000) $ (40,000) $(200,000) Action paid $205,000 in cash for all of the above from Slacker. a) Determine if Action must record any goodwill. Show any calculations. b) Record the acquisition in Action's general journal on Feb. 16, 2023. Show: any calculations. c) Prepare any adjusting entry for amortization required as of the fiscal year end, December 31, 2023. If no amortization is required, explain why.Carla Vista Company's balance sheet at December 31, 2026 reports assets of $994000 and liabilities of $778000. All of Carla Vista's assets book values approximate their fair value, except for land, which has a fair value that is $59000 greater than its book value. In addition, notes payable has a fair value that exceeds its book value by $52000. On December 31, 2026, Sunland Corporation paid $332000 to acquire Carla Vista. What amount of goodwill should Sunland record as a result of this purchase? O $57000 O $5000 O $109000 O $116000
- 1. The Judi Company purchased another entity for P8,000,000 cash. A schedule of the fair value of the acquired entity's assets and liabilities is prepared as of the purchase date. Cash Accounts Receivable Inventory Property, plant and equipment 6,550,000 Accounts payable Notes Payable - Bank (long-term) 1,950,000 Net assets at fair value 100,000 850,000 1,300,000 4,300,000 950,000 1,000,000 4,600,000 Compute for the amount of goodwill using residual approach. a. P 1,450,000 b. 3,400,000 c. P 4,600,000 d. P 2,900,000Show the solution in good accounting form Orange Company’s ledger revealed the following account balances as of December 31, 2020: Unamortized discount on bonds payable P120,000; Organization costs P100,000; Losses in early years of company P450,000; Trademarks P750,000 Patents P150,000; Amount set up by BOD as goodwill P300,000. How much should be presented as intangible assets shown In the statement of financial position?Oriole Company's balance sheet at December 31, 2026 reports assets of $1054000 and liabilities of $722000. All of Oriole's assets' book values approximate their fair value, except for land, which has a fair value that is $62000 greater than its book value. In addition, notes payable has a fair value that exceeds its book value by $52000. On December 31, 2026, Ivanhoe Corporation paid $449000 to acquire Oriole. What amount of goodwill should Ivanhoe record as a result of this purchase? O $3000 O $55000 $117000 $107000