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    16 views25 pages

    AFAR 1st PBOARD ReSA OCT 2017 PDF

    Uploaded by

    Alvin Quizon

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    of 25
    [ADVANCED FINANCIAL ACCOUNTING & REPORTING July 16, 2017 First Pre-board Examination ' 03:00PM - 06:00PM Set A Multiple Choice Tnateuction: Select the cobrect answer for each of the following questions. Mark only one answer for each item to the box corresponding to your choice on the answer sheet provided. Strictly no erasures are allowed. Use pencil no. 2. Computations are not necessary. Tteme 1 to 5 are based on the following information: On January 1, 20x4, ND Company exchangeg 15,000>shares of its common stock for all of the asseye-and Liabilities of OT@ TAC. Each of NI’s shares has a @ipe aiee aia “Ean value. the faiz. value_of the steekexchanged in TAO acquiaition wawrconsidered equal to O1G's fair value. NT also paid P2gj00D-in stock registration and issuance costs in tOnnection with the Grerger. ‘ Several of OTG's accounts have fair values that differ from their book values on this date: Book vaives Receivables 65,000 Trademarks... 95,000 Record music catalog... +--+» 3 ie 000 Cle Ineprocess research and development ..1.-..-.- 0 ayablo ee Se 50,000 revcombination January 1, 20x4, book values for the two companies are as Tous: Nt OIG Cosh * vee 60,000, P 29,000 Receivables 150,000 63,000 [> Trademarks : 400,008, 95,000 P= Record music catalog - ‘40.000 60,0001, Equipment (net) . . 320,000 105,000 |**" Totals... i Pi77o0 — 384.000 Accounis payable . P1000 P3400" NIP cso e teg end stilavaesech a. 50,000 Contmnonslgeh Ai ihy,, «fai oscos salina aie CH00,080> + 50.000 Additional poidin copii =o. ..00. 0. 30000" 30.0004 Retained earings 860,000 _190,000 Tolols dese 1.770.000 Assume that this combination is a statutory merger so that (rc's) accounts will be transferred to the record3-of-wrx-OTG-will be dissolved and will no Tonger exise a9 a legal entity. imnediately the business combination using ‘sition method, determine 1. The total assets amounted to: A. 2,124,000 c. P2,574,000 77 B. P2,547,000 D. . P2,599,000% The common stock amounted to: A. P'50,000 c. R450, 000 78. -P400,000 D.. P460,0007 3. The additional paid-in capital amounted to: OB. P-30,000 c. P695,000 B. P 60,000 D. - B720,000 4. The retained earnings amounted to: 199,000 c. PB 860,000 835,000 A, D. 2,050, 000 5. AL£ and Ben. partners in Alf & Ben Partnership who share net income and losses caw ed capital account. balances—of (640,000 and P40, 000, respec’ ‘on September 25, 20x7, 6n which date following journal y was prepared for the partnership: sh — €2,000 * Goodwiil [1P62,000 x 3) ~ (P100,000 + P62,000)1* 24,000 Alf, Capita? (P24,000 x 0.50) : 12,000 4 Ben, Capital (P24,000 x 0.50) 12,000 Cam, Capita’ To record’ investment by Cam for a-one-third interest in capital, with goodwill of 224,000 divided equally between valf and Ben. 62,000 ReSA: Ihe Review School of Accountancy Page 2 of 13 Sh cote eer a a di eceeeerte j i Snags apiuaga Ui, det eeeey Atl ea A PMID Netanya oO Alf and to Ben, : CIN Hc. sialon cotati Ue th oh) 1 Senda goed cao, pee pas o, Baek eo 6. Which of the capital balan: either a kone ox goodmiil. et evenents is consecs regarding « partnen’s debit A. The partner sh rake < Liions oo reauce the debie balance to whatever extent possibis. B. If contributions are not possible, che other partners with credit capital balances ill be aliccates a portion of the debit balance based on their \ - proportionace profitsand-loas-sharing percentages. ee ss . aia (© Raxenere so sbicie ancther‘s debit capital balance, hava a degal Claim against the deficieut partn SBE mA 6h these, = 7. If a partnership has oniy —— is, all liabilities have been properly Sia Ney te ots torn ee Sapenses are cxpected, the maximum porential loss to the pe: a the liquidatien process is: if ‘Av fe fake aac aa el ME Sn ts Supe ‘Bethe bock value of che ncn-cast ©. the estinsted procesds x value of ©! D. none of the above ole of the assets less the book Items 8 to 14 are basod on the Following information: On December 31, 20x4, PP acquired assets and liabilities of ss Company. PP will maintain Ss as 4 wholly om paidiary with its own legal and ai transtezred to the ower of SS inchigk c sKaves ( jatket value, PS par value) an ada3 sional es mn cash if S35 meets 3TZFEORE SPP estimates a 50 certain project completion yoais py de, percent probebility that 93 wii! he Relained eomins... é 1.185.000) £435,000) Total fabilties and equilies _ite.540000) _(PB85,0001 ee Note: Parentheses indicate a crecit belaace. In addition, PP assessed a x ke—have a fair value of PL %215,900 in connection wink registration costs. Use a9 project under way at 53 {suka sccomeing ass of 9,900 in hs aa aenicion cag O eos LBL miloustooe het hoaey, pail-in, oa x "Pa0-008 B:,

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