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P Company issued 5,000 shares of its common stock, valued at P200,000 to the former shareholders of S Company two years after S company was

P Company issued 5,000 shares of its common stock, valued at P200,000 to the former shareholders of S Company two years after S company was acquired in an all-stock transaction. The additional shares were issued because P Company agreed to issue additional shares of common stock if the average post combination earnings over the next two years exceeded P500,000. P Company will treat the issuance of the additional shares as a (decrease in)

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-Paid-in capital

-Retained earnings

-Goodwill

-Non-current liabilities of S Company assumed by P

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