At year-end, Bliss Company purchased the net assets of another entity for P6,000,000. On

the date of the transaction, the acquiree had P2,000,000 of liabilities. The assets of the

acquiree at fair value were P3,000,000 for current assets and P6,000,000 for noncurrent

assets. How should the purchase be accounted for?

A.

Negative goodwill should be credited for P1,000,000.

B.

Retained earnings should be credited for P1,000,000.

C. Gain on bargain purchase should be credited for P1,000,000.

D. The current assets should be reported at P3,000,000 and the noncurrent assets at

P5,000,000.