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Monday, November 15, 2010

Valix Finacc vol 1 Problem 20-23

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 20 Problem 20-23

1.  Cash                                                                                                                       1,000,000 
      Inventory                                                                                                                  500,000
      In-process R and D                                                                                                5,000,000
      Total assets                                                                                                            6,500,000
      Total liabilities                                                                                                        3,000,000
      Net assets                                                                                                              3,500,000

     Acquisition cost                                                                                                      8,000,000
     Net assets acquired at fair value                                                              (3,500,000)
     Goodwill                                                                                                                4,500,000

     The goodwill includes the fair value of the assembled workforce of P1,200,000.
     The assembled workforce is not accounted for separately as an asset.

2.  Cash                                                                                             1,000,000
     Inventory                                                                                         500,000
     In process R and D                                                           5,000,000
     Goodwill                                                                                      4,500,000
            Accounts payable                                                                                           2,600,000
            Notes payable                                                                                                    400,000
            Cash                                                                                                                8,000,000

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