Solution-What is the number of shares to be issued to

What is the number of shares to be issued to company a

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Reference no: EM133089238

Question - Q1. The condensed statement of financial position accounts of Panda Inc. and Selina Inc. as of December 31, 2018 show:

	Panda Inc.	Selina Inc.
Assets	P3,125,000	P950,000
Liabilities	1,625,000	250,000
Ordinary Share Capital (par P80)	1,250,000	500,000
Retained Earnings	250,000	200,000

On January 1, 2019, Panda acquired for cash the 4,000 shares of Selina at P150 per share.

In the consolidated statement of financial position prepared after acquisition, what is the combined assets (assuming the non-controlling interest is measured at its fair value)?

Q2. Companies A and B decided to combine to form C. Net assets and estimated earnings contributions are as follows:

	Net Assets	Est. Annual Earnings
Company A	500,000	82,000
Company B	400,000	50,000

Stockholders of the two companies agree that a single class of stock be issued and total stock to be issued be measured by their total contribution. The normal rate of return is 12% and earnings in excess of the normal rate of return shall be capitalized at 25%. It was also agreed that the authorized capital stock of C shall be 20,000 shares with par value of P150 a share. What is the number of shares to be issued to Company A?

Reference no: EM133089238

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What is the number of shares to be issued to company a

Reference no: EM133089238

Reference no: EM133089238

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