Reference no: EM133073143
Question - ACCOUNTING FOR BUSINESS COMBINATION - CONSOLIDATION - DATE OF ACQUISITION - On December 31, 2022, the following figures were taken from the trial balances of Pragmatic Company and Systematic Company:
|
|
Pragmatic
|
Systematic
|
|
CASH
|
P160,000
|
P40,000
|
|
RECEIVABLES
|
120,000
|
120,000
|
|
INVENTORY
|
200,000
|
140,000
|
|
PPE
|
400,000
|
200,000
|
|
GOODWILL
|
0
|
60,000
|
|
CURRENT LIABILITIES
|
40,000
|
20,000
|
|
LONG TERM LIABILITIES
|
140,000
|
100,000
|
|
ORDINARY SHARE CAPITAL
|
220,000
|
200,000
|
|
SHARE PREMIUM
|
40,000
|
0
|
|
ACCUMULATED PROFITS (LOSSES)
|
440,000
|
240,000
|
On December 31, 2022, Pragmatic issues 10,000 shares of its P 10 par value shares for the net assets of Systematic. Pragmatic's shares had a P 34 per share fair market value. Pragmatic would also issue bond debentures with fair value of P 200,000 maturing 3 years from date of issue.
Pragmatic also incurred the following expenses and paid some with its available cash: P 50,000 for broker's fee, P 40,000 for pre-acquisition audit fee, P 43,000 for legal fees, P 36,000 for SEC registration of shares issued and P 11,000 for printing of share certificates. Systematic holds an equipment that is worth P 80,000 more than its current book value.
Required -
1. How much is the total identifiable assets after the merger?
2. How much is the total liabilities after the merger?