12. On June 30, 202I Smile Corporation issued 100,000 shares of its P20 par value common stock for the net assets of Sad Company. The market value of Smile's common stock on June 30 was P36 per share. Smile paid a fee of Pl00,000 to the broker who arranged this acquisition. Costs of SEC registration and issuance of the equity securites amounted to,150,000. Contingent consideration determined to be paid after acquisition amounts to P120,000. What amount should Smile capitalize as the cost of acquiring Sad's net assets.

a.P3,720.000

b.P3,750,000

c.P3,650,000

d.P3,700,000

13.On May 1, 2021, Princess Corporation paid cash of P600,000 for all of the net assets of King Company and King is dissolved. The carrying value of the assets and liabilities of King on May 1, 2021 follow: Cash - P60,000, Inventory - P180,000, Plant and equipment (net of accumulated Depreciation of P220,000) - P320,000, Goodwill - P100,000, and Liabilities P120,000. On May l, 2021, King inventory had a fair value of P150,000, and the plant and equipment (net) had a fair value of P380,000. What is the amount of goodwill recorded in the books of Princess as a result of the business combination'?

a.P -0-

b.P30,000

c.P100,000

d.P130,000

14.On May 3l, 2021, Lovely Company has assets and liabilities with the following fair values: Current assets - 180,000, Non-current assets - P220,000, Liabilities - P40,000.On June 1, 2021, Pretty Corporation purchases the net assets of Lovely Company for P310,000 cash. In the books of Pretty Corporation the acquisition resulted in:

a.Income from acquisition of P50,000.

b.Negative goodwill of P50,000.

c.Reduction from current assets of P50,000.

d.Deduction from non current assets of P50,000.