On 1 March 2023, Abba Company (Abba) acquired 100% of the equity interests in Barbie Company, a company operating a sportswear retailing business. The acquisition transaction was in exchange for the followings:

- Cash of $30,000 to be paid two years later on 28 February 2025. Abbas incremental borrowing rate is 5% per year.

- Abba issued 10,000 shares with nominal amount of $1 each per share, to shareholders of Barbie. The market value of the shares was $500,000. Abba paid stock issue costs of $25,000.

- Transfer to Barbies shareholders an office building that is carried in its book at $25,000 (acquisition-date fair value of $50,000).

- Abba paid the following costs that are related directly to the business combination:

advisory: $1,250; legal: $5,000; accounting: $1,500; and valuation: $1,000.

- Abba agreed to pay a further $40,000 if the weighted average return on assets (ROA) of Barbie for the following three years was between 6% and 14%, $70,000 if the weighted average ROA was higher than 14%, $10,000 if the weighted average ROA was positive but lower than 6% and nothing if the weighted average ROA was negative. The amount to be paid, if required, will be paid on 1 March 2027. After careful consideration of budgets for 2023, 2024 and 2025, Abba estimated that ROA would be between 6% and 14% and, therefore, at the acquisition date, it was probable that a payment of $40,000 would be made on 1 March 2027.

Required:

1. Determine the fair value of the total amount of consideration transferred by Abba in accordance with IFRS3 Business Combination. (20 marks)

(Note: Please show each part of the total consideration separately.)

2. For the above expenditures which are not part of the consideration transferred, please prepare the journal entry. (5 marks)