PralerOon's asset has a book value of P10,460,00 and a fair market value of P11,500,000 and the book value of its liabilities amounted to P3,250,000 and the fair market value of P4,000,000.

On January 1, 2020 Prateroon Company purchased all the net assets of Stranermon Company consisting of:

• Issuance of 20,000 unissued shares of its P10 par value ordinary share capital. As of this date, the shares of Prateroon were selling at P40 per share.

• Issuance of bonds with a face value of P300,000 but are currently at 110.
• A contingent payment of P200,000 cash on January 1, 2020, if the average income of Stranemon Company durin the two-year period (2020-2021) exceeds P250,000 per year. Prateroon estimates that there is a 20% chance or probability that the P200,000 payment will be required.
• Issuance of 5,000 additional shares on January 1, 2022 to the former shareholders of Stranemon Company if the average income cover the next two years (2020-2021) equalled or exceeded P350,000. The additional 5,000 shares expected to be issued are valued at P75,000

Professional fees of P9,000 were also paid by Prateroon to its external auditors to finalize the buiness combinatio As of the date of acquisition, Stranemon Company reported the following book value and current market data:

	Book value	Fair value
Cash	60,000	60,000
Inventory	120,000	180,000
Buildings, net	500,000	560,000
Equipment, net	410,000	440,000

	Book value	Fair Value
Accounts payable	36,000	40,000
Ordinary share capital	720,000
Share premium	164,000
Retained earnings	170,000

Compute the consolidated total liabilities on January 1, 2020.