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Pink Ltd acquired all theassetsand liabilities of Sharp Ltd on 1 July 2020.At this date, theassetsand liabilities of Sharp Ltd consisted of the following: Carrying

Pink Ltd acquired all theassetsand liabilities of Sharp Ltd on 1 July 2020.At this date, theassetsand liabilities of Sharp Ltd consisted of the following:

Carrying Amount

Fair Value

Assets

Cash

400,000

400,000

Accounts receivable

380,000

420,000

Land

400,000

410,000

Vehicle

130,000

90,000

Accumulateddepreciation-Vehicle

(30,000)

Liabilities

Accounts payable

350,000

350,000

Loans

400,000

400,000

Equity

ShareCapital- 100 000 shares

500,000

Reserves

30,000

In exchange for theseassetsand liabilities, Pink Ltd agreed to

Issue 2 Pink Ltd shares for every Sharp Ltd Share - Pink Ltd shares were considered to have a fair value of $2 per share; costs of issue were $700

Transfer a piece of Land to the former shareholders of Sharp Ltd - the Land was carried in the records of Pink Ltd at $300,000 but was considered to have a fair value of $400,000.

Pay $2 per share in cash to each of the former shareholders of Sharp Ltd.

Pink Ltd incurred $2,200 in costs associated with the acquisition of these netassets

A.As per the Acquisition Analysis prepared on 01/07/2020, the Goodwill or gain on bargain purchase would be:

B.The Journal entry torecordvalue difference in land will be : (Ignore Income tax effect)

C.The Journal entry torecordcosts associated with the acquisition of these netassets:

D.The Journal entry torecordcosts of share issue :

E.The Journal entry torecordGoodwill or gain on bargain purchase:

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