ANSWER THE FOLLOWING:

PROBLEM 2: TRUE 0R FALSE ' =11": 1. Entity A acquires 100% interest 1n the Voting shares of Entity EH :1 for #100. Entity B's identifiable assets and liabilities have values of F200 and 9120 respectively. The goodwill 1s P80. Use thejbllowmg mfomatzon for the next two items: ' Entity A acquires 90% interest 1n the voting shares of Entity B 015; #100 Entity B's identifiable assets and liabilities have fair value of K #200 and 9120 respectively. I. I /16 Business Combinations (Part 1) 49 2. If the NCI is measured at its proportionate share in the acquiree's net identifiable assets, the goodwill would be #28. 3. If the NCI is measured at a fair value P10, the goodwill would be P18. Use the following information for the next seven items: Entity A acquires all the identifiable assets and assumes all the liabilities of Entity B for #100. Entity B's identifiable assets and liabilities have fair values of #200 and P120, respectively. 4. Entity A incurred legal fees of #20 in negotiating the business combination. The goodwill is P40. 5. Entity A estimates liquidation costs of #10 in exiting the business activities of Entity B. The goodwill is $20. 6. Entity A is renting out a license to Entity B under an operating lease. The terms of the lease compared with market terms are favorable. The fair value of the differential is $5. The goodwill is P25. 7. Entity B has an unrecorded patent with fair value of $30. The gain on bargain purchase is $10. 8. Entity B has an unrecognized contingent liability with fair value of P30. The contingent liability is a present obligation but has an improbable outflow of economic resources. The goodwill is $50. 9. Entity B's assets and liabilities have carrying amounts of P150 and $120, respectively. Fair value adjustments to the acquired assets and liabilities have deferred tax consequences but do not affect their tax bases. The income tax rate is 30%. The goodwill is $53. 10. Entity A agreed to share its trade secret processes with Entity B after the business combination. The trade secret processes have a fair value of P25. The goodwill is #20