Q11 Business Combi

Sam Corp acquired the identifiable assets of Prince Corp by issuing ordinary shares with par value of P20. Sam Corp. ordinary shares are currently traded at P30 per share. Prince Corp. statement of financial position before business combination follow: Cash 1,000,000 Liabilities 600,000 Other current assets 2,000,000 Ordinary share 2,400,000 Property, plant and equipment 2,500,000 Share premium 600,000 Retained Earnings 1,900,000 Total 5,500,000 Total 5,500,000 Sam Corp other current assets are appraised to increase to P2,200,000; and its property plant and equipment is undervalued by P500,000. The liabilities are fairly valued. What is the total shares issued by Sam Corp. to acquire Prince Corp to recognize a goodwill of P400,000? 300,000 shares 350,000 shares 260,000 shares 200,000 shares