Problem 1 - 16 Humility Inc. acquired 70% interest of Forgiveness Company, a printing business. The sale and purchase agreement specify the amount payable as: a. Cash of P12 million to be paid on acquisition date, and b. Additional 2,000 shares of its P100 par value ordinary shares to be issued after two (2) years if specified product receives the target market share. The fair value of Forgiveness Company's net assets is P11 million and estimated fair value of the contingent consideration is P300,000. NCI is measured using the proportionate method. Required 1. Assuming the target was met and shares was issued to the former shareholders of Forgiveness, the estimated fair value of contingent consideration is P400,000, how much goodwill will be presented in the consolidated financial statements two years after the acquisition? 2. Journal entry in the books of Humility Inc. (a) on the date of business combination and (b) on the issuance of 2,000 shares, in relation to #1. 3. Assuming the target was not met and no shares will be issued to the former shareholders of Forgiveness, the estimated fair value of contingent consideration is P400,000, how much goodwill will be presented in the consolidated financial statements two years after the acquisition? 4. Journal entry in the books of Humility Inc. (a) on the date of business combination and (b) on the date when issuance of 2,000 shares was forfeited, in relation to #3.