12.

The Boy George, Company acquired the net assets of the Girl Conrad Company on January 1, 2015,
and made the following entry to record the purchase:
Current Assets100,000
Equipment 150,000
Land 50,000
Buildings 300,000
Goodwill 100,000
Liabilities 80,000
Common stock,P1 par 100.000
Paid in capital in excess at par 520,000

Assuming that additional shares on January 1, 2017 would be issued on that date to compensate for any
fall in the value at Boy George common stock below P16 per share. The settlement would be to cure the
deficiency by issuing added shares based on their fair value on January 1,2017. The fair price of the
shares on January 1, 2017 was P10.

What is the additional number of shares issued on January 1, 2017 to compensate for any fall in the value
at the stock?

a. 160,000
b. 100,000
c. 60,000
d. 10,000
Answer: C