During January 20x5, P Co performed due diligence tests on S Co. On 1 February 20x5, P Co completed the purchase of 80% of S Co from V Co, the existing owner of S Co.

The following expenditures were incurred by P Co during January 20x5:

Required:

1. Determine the consideration transferred in accordance with IFRS 3 Business Combinations.
2. Show the journal entry or entries in P’s books to record the expenditures incurred by P Co in 20x5.
3. Show partial consolidation entries for the year ended 31 December 20x5.

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Payment to consultants to conduct due diligence checks on S Co.. Number of ordinary shares issued by P Co to V Co.... Fair value per share of P Co at date of share issue, reliably measured. Salary of business development manager of P Co for January 20x5... Travelling and hotel expenses incurred by the business development manager in relation to the acquisition of S Co Undiscounted cash payment payable to V Co at the end of five years. Interest payable to V Co for deferred payment... Legal fees to execute sales agreement with V Co........ Assumption of the liabilities of V Co (P assumes legal obligation to pay off the short-term liabilities of V Co in settlement of purchase price) Stamp duties and other incidentals of share issue to V Co.... $200,000 6,000,000 $3 $20,000 $15,000 $1,000,000 6% per annum $30,000 $200,000 $10,000