On January 1, 20x1, Pam acquired net assets of Sam by paying cash of P200,000 and issuance of 20,000 shares with market value of P100. On this date, the fair value of assets and liabilities amounted to P2,500,000 and P400,000, respectively.

Pam has estimated restructuring provision of P250,000 representing exit cost of Sam's activities, costs of terminating the employees of Sam. Pam also renting a building to Sam under an operating lease. Pam has determined that the term of the operating lease on the building compared to the market contract terms is favorable and its fair value is estimated at P50,000.

a. How much is the goodwill after the business combination?

b. Assuming the Pam determined that contract term of the operating lease is unfavorable, how much is the goodwill after the business combination?