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What is the amount of goodwill as of december

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Reference no: EM132741819

On January 1, 2014, Plow4 Company purchased an 75% interest in Slow4 Co. for P280,000. On this date, Slow4 Co. had Ordinary Share Capital of P100,000 and Retained Earnings of P50,000.

  • An examination of Slow4 Company's assets and liabilities revealed that book values were equal to market values all except plant and equipment (net) which had a book value of P200,000 and a market value of P250,000 and inventory which had a book value of P60,000 and a market value of P80,000. The plant and equipment had an expected remaining life of 5 years, and the inventory could all be sold in 2014.
  • Plow4 Company's income from its own operations was P70,000 in 2014 and P80,000 in 2015. Slow4 Co.'s income was P60,000 in 2014 and P50,000 in 2015. Slow4 Co. did not pay any dividends on either year. Goodwill impairment losses were P12,000 in 2014 and P16,000 in 2015.

Problem 1: Based on the consolidated financial statements: (Cost method and partial goodwill), what is the amount of Goodwill as of December 31, 2015?

Reference no: EM132741819

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