n the event the profit target was met and the P60 million cash was transferred, what amount should Puppy Eyes present for Goodwill in its statement of Financial position on December 31, 2017, according to IFRS 3 Business Combinations?
Q: On January 1, 2015, Pomegranate Company acquired 80% of the voting stock of Starfruit Company for…
A: Non-controlling interest relates to a situation of possession in which a shareholder holds less than…
Q: P Incorporated purchased 80% of The S Company on January 2, 2014, when S's book value was $800,000.…
A: If a shareholder has less acquisition of shares in a firm/company or say less than 50% of total…
Q: In 2017, Bond Inc. bought May Corporation’s net assets for $2 million. At that time, May had total…
A: Solution Bargain Purchase is when an acquirer buys asset for the amount which is less that its fair…
Q: In January 1, 2015, Fun company purchased Company A for $40,000 in cash and paid immediately. Fun…
A: goodwill recognised on the day of purchase = purchase price- ( assets - liabilities ) = $40,000 - (…
Q: On January 1, 2020, Shell Corporation acquired the net assets of Petron Inc. The acquirer…
A: 1. Value of contingent consideration shall be the additional pay of P 1500000 which would be paid if…
Q: Lion Company is considering the acquisition of Tiger Company, Inc. early in 2018. To assess the…
A: Goodwill is an intangible asset which is related with the purchase of one company by another.…
Q: Giant acquired all of Small’s common stock on January 1, 2014, in exchange for cash of $770,000. On…
A: Requirement a:
Q: Angkasa Corporation paid Rp5,000,000 for 80% interest on Langit Biru Corporation on January 1, 2020.…
A: While consolidation, Parent company records % share of income in Subsidiary i.e. Equity method.…
Q: Giant acquired all of Small’s common stock on January 1, 2017, in exchange for cash of $770,000. On…
A: Equity is the portion of a company's value that can be attributed to its owners. The book value of…
Q: Lakecraft Company has the following balance sheet on December 31, 2015, when it is acquired for…
A: Acquisition bookkeeping is a lot of formal rules depicting how resources, liabilities,…
Q: On July 1, 2018, Gupta Corporation bought 25% of the outstanding common stock of VB Company for $100…
A: 1. Prepare necessary journal entries for the given transactions. Working note 3:
Q: On January 1, 2020, Alison, Inc., paid $77,000 for a 40 percent interest in Holister Corporation’s…
A: Investment is the process of generating income in the near future by investing in an asset which is…
Q: Giant acquired all of Small’s common stock on January 1, 2017, in exchange for cash of $770,000. On…
A: Consolidation refers to the acquisition of many small companies by one large company by obtaining…
Q: ABC Co. is contemplating on acquiring XYZ Inc. The following information was gathered through a…
A: Goodwill is recorded by an organization when it acquires assets and liabilities by paying price that…
Q: On June 30, 2016, Gab Company purchased 25% of the outstanding ordinary shares of IB Co. at a total…
A: Under the fair value method, the investment is reported at the fair value of the market share of the…
Q: The following are individual financial statements for the year ending December 31, 2021. On that…
A: Consolidated financial statements: When an investor company holds above 50% in the outstanding stock…
Q: qMLM Inc. acquired net assets of Lizzi Corporation on January 1,2014, for P700,000 in cash. This…
A: Acquisition date is the date on which the asset is purchased and from this date the asset will be…
Q: On January 1, 2020, Alison, Inc., paid $83,800 for a 40 percent interest in Holister Corporation’s…
A: Solution Common stock can be defined as securities that represent individuals ownership in a said…
Q: On September 1, 2017, Winans Corporation acquired Aumont Enterprises for a cash payment of $700,000.…
A: Workings: Given values Acquired Aumont enterprises for $ 700000 Assets = $ 620000 Liabilities = $…
Q: Tomato co. Purchased 40% of MU corp. On april 1,2017, for 500,000 when MU's book value was…
A: 1) The journal entries and balances for investment income in 2017 is,
Q: P Company wishes to acquire S Co. for cash in an asset acquisition, and appraisals reveal that the…
A: Goodwill on acquisition is arising on paying the amount over the net identifiable assets of the…
Q: Frappe Company is acquiring Frappuccino Corporation on January 1, 2020. The cumulative earnings of…
A: Calculation of goodwill: Thus, goodwill is P2,800,000.
Q: verstated by P4,500 and equipment with a remaining 5 year life on the purchase date which was…
A: To find the Non-controlling interest's share as,
Q: Giant acquired all of Small’s common stock on January 1, 2017, in exchange for cash of $770,000. On…
A: Consolidation refers to the acquisition of many small companies by one large company by obtaining…
Q: On January 1, 2017, Alison, Inc., paid $800,000 for a 40 percent interest in Hollister Corporation’s…
A:
Q: What is the Consolidated net income or group profit for the year ended December 31, 2020? 2). What…
A: Consolidated net income is the combined net income earned by the parent entity from the business…
Q: During January 2018, Varren, Inc. acquired 30% of the outstanding common stock of Wolf Co. for…
A: A company may invest in another company. The company reports the investment in another company as an…
Q: the acquisition, the two companies have the following account balances. Clay’s equipment (with a…
A: Consolidated Statements: Consolidated statements are reports that can be utilized when the parent…
Q: Calculate the Investment in S shown on P's ledger at December 31, 2014. Calculate the Investment…
A: For the year ending Dec 31, 2014 Acquisition cost i.e $25,00,000 X 90% = $22,50,000 Less: Excess…
Q: On January 1, 2018, Panorama Company acquired 80% of Scann Corporation for $6,400,000.At the time of…
A: 1.Investment in S at December 31,2018 = $6,400,000 * 80% + $300,000 * 80% = $5,120,000 + $240,000 =…
Q: 1) Calculate Investment in Scann shown on Panorama's ledger at December 31, 2018 and 2019. 2)…
A:
Q: On January 1, 2018, Panorama Company acquired 80% of Scann Corporation for $6,400,000.At the time of…
A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…
Q: On August 1, 2017, Riverbed Corporation acquired Marin, Inc. for a cash payment of $2.30 million. At…
A: Goodwill is an excess amount of purchase consideration over the net value of assets. It is based on…
Q: On March 1, 2020, Dorsey Corporation purchased Johnson Company. The book and fair value of Johnson's…
A:
Q: Adams, Inc., acquires Clay Corporation on January 1, 2020, in exchange for $732,300 cash.…
A: Step 1 Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for…
Q: Branson paid $465,000 cash for all of the outstanding common stock of Wolfpack, Inc., on January 1,…
A: Hey, since there are multiple sub-parts posted, we will answer the three sub-parts. If you want any…
Q: On January 1, 2017, Alison, Inc., paid $60,000 for a 40 percent interest in Holister Corporation’s…
A: (A) Following is the calculation of amount appear in the investment in H’s account by using equity…
Q: ABC Co. is contemplating on acquiring XYZ Inc. The following information was gathered through a…
A: Goodwill means the reputation of the company due to any factor like location , product , price ,…
Q: Adams, Inc., acquires Clay Corporation on January 1, 2020, in exchange for $713,300 cash.…
A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…
Q: On January 1, 2013, Babe Company acquired a long term investment for P7,000,000, a 40% interest in…
A: Investment in Associate entity If investor is holding shares in the range of 20% to 50% of…
Q: On January 1, 2017, Sparky Co. acquired 80% of the outstanding stock of Panda Co. for P225,000 cash.…
A: Gain on acquisition is the difference between the purchase price and the fair value of assets…
Q: Giant acquired all of Small’s common stock on January 1, 2017, in exchange for cash of $770,000. On…
A: Consolidated financial statements are a set of financial statements prepared for a group company…
Q: In January 1, 2015, Fun company purchased Company A for $40,000 in cash and paid immediately. Fun…
A: Goodwill- It refers to the image of a business, which is an intangible asset but carries some…
Q: On January 1, 2017, Palka, Inc., acquired 70 percent of the outstanding shares of Sellinger Company…
A: Calculation of additional paid-in capital: Fair value at the time of acquisition: Net Income +…
Q: On September 1, 2017, Winans Corporation acquired Aumont Enterprises for a cash payment of $700,000,…
A: Solution: Introduction: Goodwill is an intangible asset that will arise when one company purchases…
Q: On January 1, 2017, Perla Corporation purchased all of the outstanding common stock of Siena Company…
A: Please see the next step for the solution
Q: Duckworth Corporation purchases an 80% interest in Panda Corporation on January 1, 2017, in exchange…
A:
Q: On August 27, 2015, Celgene Corporation acquired all of the outstanding stock of Receptos, Inc., in…
A: Acquisition method comes into play when company acquires the other company and the acquirer company…
Q: On January 1, 2017, QuickPort Company acquired 90 percent of the outstanding voting stock of…
A: a.
On October 1, 2017, the Puppy Eyes Company acquired the net assets of The Cat Love Company when the fair value of Cat Love’s net assets was P116 million and their carrying amount was P120 million. The consideration transferred comprised P200 million in cash transferred at acquisition date, plus another P60 million in cash to be transferred 11 months after the acquisition date if a specified profit target being met by Cat Love. At the acquisition date there was only a low probability of the profit target being met, so the fair value of the additional consideration liability was P10 million.
In the event the profit target was met and the P60 million cash was transferred, what amount should Puppy Eyes present for
Step by step
Solved in 2 steps
- On October 1, 2017, the Puppy Eyes Company acquired the net assets of The Cat Love Company when the fair value of Cat Love’s net assets was P116 million and their carrying amount was P120 million. The consideration transferred comprised P200 million in cash transferred at acquisition date, plus another P60 million in cash to be transferred 11 months after the acquisition date if a specified profit target being met by Cat Love. At the acquisition date there was only a low probability of the profit target being met, so the fair value of the additional consideration liability was P10 million. In the event the profit target was met and the P60 million cash was transferred, what amount should Puppy Eyes present for Goodwill in its statement of Financial position on December 31, 2017, according to IFRS 3 Business Combinations? Group of answer choices 84 million 144 million 94 million 140 millionMoon Company is contemplating the acquisition of Yount, Inc., on January 1, 2015. If Moon acquires Yount, it will pay $730,000 in cash to Yount and acquisition costs of $20,000. The January 1, 2015, balance sheet of Yount, Inc., is anticipated to be as attached:Fair values agree with book values except for the inventory and the depreciable fixed assets, which have fair values of $70,000 and $400,000, respectively. Your projections of the combined operations for 2015 are as follows: Combined sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $200,000 Combined cost of goods sold, including Yount’s beginning inventory, at book value, which will be sold in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120,000 Other expenses not including depreciation of Yount assets . . . . . . . . . . . . . . . . . . . . . . . . 25,000Depreciation on Yount fixed assets is…On October 01,2019, the Tomoe Co. acquired 100% of the Nanami Co. when the fair value of Nanami's net assets as Php116M and their carrying amount was Php120M. The consideration transferred comprised Php200M in cash transferred at the acquisition date, plus another Php60M in cash to be transferred 11 months after the acquisition date if a specified profit target was met by Nanami. At the acquisition date, there was only a low probability of the profit target being met, so the fair value of the additional consideration liability was Php10M. In the event, the profit target was met and the Php60M cash was transferred. Provide the Journal Entries for the business combination until the measurement period
- Tweeden Corporation is contemplating the acquisition of the net assets of Sylvester Corporation in anticipation of expandingits operations. The balance sheet of Sylvester Corporation on December 31, 2015, is as attached:n appraiser for Tweeden determined the fair values of Sylvester’s assets and liabilities to be as shown as in attachment 2The agreed-upon purchase price is $580,000 in cash. Acquisition costs paid in cash total $20,000.Using the above information, do value analysis and prepare the entry on the books of Tweeden Corporation to acquire the net assets of Sylvester Corporation on December 31, 2015.On January 1, 2022 the Aquila Co. acquired 100% of the Taurus Co. when the fair value of Taurus net assets was P4,000,000 and their carrying amount was P3,500,000. The consideration transferred consisted of P4,400,000 in cash transferred at the acquisition date, plus another P200,000 in cash to be transferred 10 months after (November 1, 2022) the acquisition date if a specified profit target was met by Taurus.At the acquisition date, there was only a low probability, around 40% of the profit target is being met.On November 1, 2022, additional P200,000 was paid by Aquila to Taurus after the latter met the specified profit target.How much is the goodwill to be reported on December 31, 2022? a. P480,000 b. P600,000 c. P980,000 d. P400,000On January 1, 2020, Shell Corporation acquired the net assets of Petron Inc. The acquirertransferred cash amounting to P3,000,000 and obligates itself to pay additional P1,500,000 afterone year if the market price of Shell Corporation increased by 50%. The businesscombination resulted to a goodwill of P300,000.At the date of acquisition, it is estimated that there is a 70% probability that the condition will bemet.On March 1, 2020, The operations of Shell Corporation was halted due to COVID 19 –pandemic lockdown and restrictions, this resulted to a 30% decrease in probability estimation ofthe contingent consideration. 1. What is the value of contingent consideration on March 1, 2020?a. 1,500,000b. 1,050,000c. 450,000d. 600,000 2. What is the effect of the March 1, 2020 information to the recognized goodwill?a. Goodwill decreased by P450,000.b. Gain on bargain purchase will be recognized in the amount of P150,000.c. Gain on bargain purchase will be recognized in the amount of…
- In 2017, Bond Inc. bought May Corporation’s net assets for $2 million. At that time, May had total liabilities of $600,000, total current assets of $1.08 million, and total noncurrent assets of $2.52 million. Given these figures, Bond should account for the $1 million difference between the fair value of the net assets acquired and May’s purchase price by?On August 1, 2017, Concord Corporation acquired Skysong, Inc. for a cash payment of $2.10 million. At the time of purchase, Skysong's balance sheet showed assets of $4,350,000, liabilities of $2,550,000, and owners' equity of $1,800,000. The fair value of Skysong's identifiable assets is estimated to be $4,326,000. Compute the amount of goodwill acquired by Concord. Value assigned to goodwill $On 1 January 2017, Addo Limited acquired an investment property for GHC 11 million. The purchase agreement provided for settlement in full on 31 December 2017 (an appropriate discount factor is 10%). GHC 1 million transfer duty and GHC 20 000 legal fees were incurred and paid during January 2017 in respect of the acquisition of this property. Rates for the year ended 31 December 2017 of GHC100 000, were paid on 30 November 2017. All amounts given are exclusive of value added tax. During 2017, Addo Limited constructed an investment property, expenditure on which is detailed below: Labour: GHC 2 million (GHC 200,000 of which was incurred due to restore faulty work pe rformed by ‘scab’ labourers whilst the company’s employees were on strike and a further GHC 100,000 was in respect of unproductive time whilst waiting for the foundations to dry); Materials: GHC 8 million (GHC1,000,000 of which was incurred to restore faulty work performed by ‘scab’ labourers whilst the company’s employees…
- On August 27, 2015, Celgene Corporation acquired all of the outstanding stock of Receptos, Inc., in exchange for $7.6 billion in cash. Referring to Celgene's 2015 financial statements and its July 14, 2015, press release announcing the acquisition, answer the following questions regarding the Receptos acquisition. What accounting method was used, and for what amount, to record the acquisition?Mikkeli OY acquired a brand name with an indefinite life in 2021 for 43,600 markkas. At December 31, 2020, the brand name could be sold for 35,200 markkas, with zero costs to sell. Expected cash flows from the continued use of the brand are 45,870 markkas, and the present value of this amount is 34,200 markkas. Assume that Mikkeli OY is a foreign company using IFRS and is owned by a company using U.S. GAAP. Thus, IFRS balances must be converted to U.S. GAAP to prepare consolidated financial statements. Ignore income taxes. Required: Prepare journal entries for this brand name for the year ending December 31, 2020, under (1) IFRS and (2) U.S. GAAP. Prepare the entry(ies) that the U.S. parent would make on the December 31, 2020 conversion worksheet to convert IFRS balances to U.S. GAAP.Asap