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Compute the amount of goodwill

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Question - Can Company acquired 25% of Debby Company's ordinary shares for P1,900,000 cash and carries the investment using the cost method. After six months, Can purchased another 55% of Debby's ordinary shares for P5,500,000. The said amount excludes control premium of P275,000. On this date, Debby reports identifiable assets with carrying value of P9,000,000 and fair value of P11,500,000 and it has liabilities with a book value and a fair value of P3,500,000. The fair value of the non-controlling interest is P1,500,000. Compute the amount of Goodwill.

a. P1,775,000

b. P1,875,000

c. P2,000,000

d. P1,900,000

Reference no: EM132967903

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