Reference no: EM133155638

Question - The following are the balance sheet of AiP and BiS Co. when AiP decided to acquire 4,500 SHARES of BiS for P577,800:

	AiP Company	BiS Company
Cash	850,000	50,000
Receivables	200,000	100,000
Inventories	600,000	200,000
Plant and equipment	1,260,000	450,000
Total	2,910,000	800,000
Liabilities	300,000	200,000
Share capital, par P100	2,000,000	500,000
Share premium	400,000
Retained earnings	210,000	100,000
Total	2,910,000	800,000

Assume that AiP acquired the 4,500 shares of stocks of BiS by issuing 5,000 of its shares with a market value of P115.56 and on this date the market values of BiS inventories and PPE are P210,000 and P470,000 respectively.  (Use Full Goodwill Method)

Required - Prepare the following:

1. Regular journal entry to record the business combination transaction.

2. Working paper adjustment and elimination entry for consolidation purposes.

3. Consolidated working paper (8 or 10 column worksheet).