Hello! Please help me answer this question:

Prob. 1. On October 1, 2017, the Puppy Eyes Company acquired the net assets of The Cat Love Company when the fair value of Cat Loves net assets was P116 million and their carrying amount was P120 million. The consideration transferred comprised P200 million in cash transferred at acquisition date, plus another P60 million in cash to be transferred 11 months after the acquisition date if a specified profit target being met by Cat Love. At the acquisition date there was only a low probability of the profit target being met, so the fair value of the additional consideration liability was P10 million.

1. Assuming the profit target was not met, what amount should Puppy Eyes present for Goodwill in its statement of financial position on December 31, 2017, according to IFRS 3 Business Combinations?

Group of answer choices

140 million

114 million

84 million

94 million

Prob. 2. On October 1, 2017, the Puppy Eyes Company acquired the net assets of The Cat Love Company when the fair value of Cat Loves net assets was P116 million and their carrying amount was P120 million. The consideration transferred comprised P200 million in cash transferred at acquisition date, plus another P60 million in cash to be transferred 11 months after the acquisition date if a specified profit target being met by Cat Love. At the acquisition date there was only a low probability of the profit target being met, so the fair value of the additional consideration liability was P10 million.

Assuming the target profit was not met, what amount should Puppy Eyes recognize as gain on contingent consideration in its income statement for the year 2017?

Group of answer choices

50 million

60 million

0

10 million