1. Summer book value (BV) and fair value (FV) balances immediately before the combination of Autumn ("the acquiring company") and Fall ("the acquired company") are as follows:

Autumn Fall

Book ValueBook ValueFair Value

Cash 525,000 60,00060,000

Inventories180,000 120,000150,000

Other Current Assets 45,000 30,00030,000

Plant Assets, net 390,000 270,000270,000

Total Assets1,140,000480,000510,000

Current Liabilities 240,000 45,00045,000

Other Liabilities 120,00 75,00060,000

Ordinary Share, $15 630,000 300,000

Accumulated Profits 150,000 60,000

Total Liabilities & Equity1,140,000480,000

On December 31, 2019, Autumn pays $325,000 cash and also issued 30,000 shares of $15 par value ordinary share capital with a market value of $25 per share for all the net assets of Fall. Moreover, Autumn pays $45,000 for registering and issuing the 30,000 shares and recognized P105,000 worth of contingent liabilities of Fall which is expected to be paid.

After the business combination, Fall will cease to exist and Autumn will be the surviving company.

Required:

1.How much is the amount of Goodwill that resulted from the business combination?

2.After the business combination, how much would be the total assets of Autumn?

2. On January 15, 2021, Percy Company acquired 12% of Relient Company's ordinary shares for $750,000 and carried the investment using the cost model under International Accounting Standard 39. A few months later, Percy purchased another 73% of Relient's share for $5,475,365. At that date, Relient reports identifiable assets with a book value of $7,530,000 and a fair value of $9,036,000, and has liabilities with book value and fair value of $3,635,750. The fair value of the NCI is not given.

Required:

1.Using the Fair Value Basis Approach, how much should be reported as Non-controlling interest in the net assets of the subsidiary (NCINAS) as at the acquisition date?

2.Using Proportionate Basis Approach, how much should be reported as Goodwill as a result of the shares acquisition?

3.How much is the balance of Investment in Subsidiary account in the books of Percy immediately after the 2nd shares acquisition?