Question
On 30 June 2014 TYO acquired 800,000 of PLO's 1 million shares. The purchase consideration was as follows: TYO issued 3 shares for every
On 30 June 2014 TYO acquired 800,000 of PLO's 1 million shares. The purchase consideration was as follows: TYO issued 3 shares for every five shares acquired in PLO. On 30 June the market price of a TYO share was $3.80 and the market price of a PLO share was $3.00. TYO agreed to pay $550,000 in cash to the existing shareholders on 30 June 2015. TYO's borrowing rate was 10% per annum. TYO paid advisors $100,000 to advise on the acquisition. What is the cost of investment that will be used in the goodwill calculation in the consolidated accounts of TYO?
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Financial Reporting and Analysis
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
7th edition
1259722651, 978-1259722653
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