What was the acquisition cost of the equipment

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Question 1 - On December 31, 2021, JV Company purchased for P4,000,000 cash all of the outstanding ordinary shares of Jinggoy Company when Jinggoy's statement of financial position showed net assets of P3,200,000. Jinggoy's assets and liabilities had fair value different from the carrying amount as follows:

 

Carrying amount

Fair value

Property, plant and equipment, net

5,000,000

5,750,000

Other assets

500,000

0

Long-term debt

3,000,000

2,800,000

Required - What amount should be reported as goodwill in the December 31, 2021 consolidated statement of financial position of JV Company and its wholly-owned subsidiary?

Question 2 - On January 1, 2019, Chiz Company acquired equipment to be used in its manufacturing operations. The equipment has an estimated useful life of 10 years and an estimated residual value of P50,000. The depreciation applicable to this equipment was P240,000 for 2021 computed under the sum of years' digits method. What was the acquisition cost of the equipment?

Reference no: EM133179136

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