Samson, Eizzel Marie C.
ASSIGNMENT:
Problem 1
HOPE Company acquired the net assets of WISDOM Company on January 3,
2017, for P565, 000. In addition, P5, 000 of professional fees were incurred in
consummating the combination. At the time of acquisition, WISDOM Company reported
the following book values and current market value as follows:
Book values
Fair value
Cash and Receivables
P 50, 000
P50, 000
Inventory
100, 000
150, 000
Building and Equipment (net)
200, 000
300, 000
Patent
–
200, 000
Total Assets
P350, 000
P700, 000
Accounts Payable
P 30, 000
P 30, 000
P350, 000
