: d

Price paid P4,000,000

Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c
MULTIPLE CHOICES - COMPUTATIONAL

20-1: b

Bad debt expense (S$ 6,000 x P28.20) P169,200

Amortization of patents (S$ 4,000 x P28.20) 112,800
Rent expense (S$ 10,000 x P28.20) 282,000
Total P564,000
Average rate (P28.20) is used to translate all expenses since this is a reasonable
estimation.

20-2: b

Machinery [(24,000 Ringgit ÷ 10) x P10.42] P 25,008

Equipment [(12,000 Ringgit ÷ 10) x P10.42] 12,504
Total depreciation P 37,512

20-3: d

Accounts receivable P120,000

Prepaid expenses 55,000
Property and equipment (net) 275,000

Average rate for the year is used in translating depreciation expense because this is more
reasonable estimation than the rate when the related asset was acquired (P4.80).

Forex
: d

Price paid P4,000,000

Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

1
 Price paid P 450,000
Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c
MULTIPLE CHOICES - COMPUTATIONAL

20-1: b

Bad debt expense (S$ 6,000 x P28.20) P169,200

Amortization of patents (S$ 4,000 x P28.20) 112,800
Rent expense (S$ 10,000 x P28.20) 282,000
Total P564,000
Average rate (P28.20) is used to translate all expenses since this is a reasonable
estimation.

20-2: b

Machinery [(24,000 Ringgit ÷ 10) x P10.42] P 25,008

Equipment [(12,000 Ringgit ÷ 10) x P10.42] 12,504
Total depreciation P 37,512

20-3: d

Accounts receivable P120,000

Prepaid expenses 55,000
Property and equipment (net) 275,000

Average rate for the year is used in translating depreciation expense because this is more
reasonable estimation than the rate when the related asset was acquired (P4.80).

Forex
: d

Price paid P4,000,000

Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c
MULTIPLE CHOICES - COMPUTATIONAL

2
20-1: b

Bad debt expense (S$ 6,000 x P28.20) P169,200

Amortization of patents (S$ 4,000 x P28.20) 112,800
Rent expense (S$ 10,000 x P28.20) 282,000
Total P564,000
Average rate (P28.20) is used to translate all expenses since this is a reasonable
estimation.

20-2: b

Machinery [(24,000 Ringgit ÷ 10) x P10.42] P 25,008

Equipment [(12,000 Ringgit ÷ 10) x P10.42] 12,504
Total depreciation P 37,512

20-3: d

Accounts receivable P120,000

Prepaid expenses 55,000
Property and equipment (net) 275,000

Average rate for the year is used in translating depreciation expense because this is more
reasonable estimation than the rate when the related asset was acquired (P4.80).

Forex
MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) 175,000
Balance of Allowance for Overvaluation account before adjustment P 35,000

13-3: b

Inter-company inventory profit (IIP) before closing P 66,000

Less: IIP from shipment from home office
Billed price P300,000
Cost (P300,000 / 125%) 240,000 60,000
IIP from beginning inventory at billed price P 6,000
Divided by ÷ 25%
Cost of branch’s beginning inventory P 24,000

13-4: a
MULTIPLE CHOICES - COMPUTATIONAL

3
 MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

Price paid P4,000,000

Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c

MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) MULTIPLE CHOICES
-MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) 175,000
Balance of Allowance for Overvaluation account before adjustment P 35,000

13-3: b

Inter-company inventory profit (IIP) before closing P 66,000

Less: IIP from shipment from home office
Billed price P300,000
Cost (P300,000 / 125%) 240,000 60,000
IIP from beginning inventory at billed price P 6,000
Divided by ÷ 25%
Cost of branch’s beginning inventory P 24,000

13-4: a
MULTIPLE CHOICES - COMPUTATIONAL

4
 MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

Price paid P4,000,000

Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c

MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) MULTIPLE CHOICES
-MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) 175,000
Balance of Allowance for Overvaluation account before adjustment P 35,000

13-3: b

Inter-company inventory profit (IIP) before closing P 66,000

Less: IIP from shipment from home office
Billed price P300,000
Cost (P300,000 / 125%) 240,000 60,000
IIP from beginning inventory at billed price P 6,000
Divided by ÷ 25%
Cost of branch’s beginning inventory P 24,000

5
13-4: a
MULTIPLE CHOICES - COMPUTATIONAL

MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

15-3: c

MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) MULTIPLE CHOICES
-MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) 175,000
Balance of Allowance for Overvaluation account before adjustment P 35,000

13-3: b

Inter-company inventory profit (IIP) before closing P 66,000

Less: IIP from shipment from home office
Billed price P300,000
Cost (P300,000 / 125%) 240,000 60,000
IIP from beginning inventory at billed price P 6,000
Divided by ÷ 25%
Cost of branch’s beginning inventory P 24,000

13-4: a
MULTIPLE CHOICES - COMPUTATIONAL

MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

Price paid P4,000,000

6
 Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c

MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) MULTIPLE CHOICES
-MULTIPLE CHOICES - COMPUTATIONAL

13-1: c

13-2: a

Goods available for sale:

At billed price (P30,000 + P180,000) P210,000
At cost (P210,000 / 120%) 175,000
Balance of Allowance for Overvaluation account before adjustment P 35,000

13-3: b

Inter-company inventory profit (IIP) before closing P 66,000

Less: IIP from shipment from home office
Billed price P300,000
Cost (P300,000 / 125%) 240,000 60,000
IIP from beginning inventory at billed price P 6,000
Divided by ÷ 25%
Cost of branch’s beginning inventory P 24,000

13-4: a
MULTIPLE CHOICES - COMPUTATIONAL

MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

7
 Price paid P4,000,000
Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000

P 25,008
Average rate for the year is used in translating depreciation expense because this is more
reasonable estimation than the rate when the related asset was acquired (P4.80).

Forex loss on interest

Based on P 3,2000,000 P 120,000
Based on P 300,000,000 (P3,000,000x10%x4/12) 100,000 20,000
Forex loss P (220,000)

Total forex loss (P 8,000 + P220,000) P (228,000)

19-5: a.

Direct forex rate – Transaction date (P 1 ÷ $0.018) P 55.5555

Direct forex rate – Balance sheet date (P 1 ÷ $0.017) 58.8235
Direct forex rate – Settlement date (P 1 ÷ $0.020) 50.0000

Forex gain (loss), 2012

Transaction date ($10,000 x P55.5555) P 555,555
Balance sheet ($10,000 x P 58.8235) 588,235
Forex loss (increase) P ( 32,680)

Forex gain (loss), 2013

Balance sheet date ($10,000 x P58.8235) P 588,235
Settlement data ($10,000 x P 50.00) 500,000
Forex gain (decrease) P 88,235

CHAPTER 20

MULTIPLE CHOICES - COMPUTATIONAL

20-1: b

Bad debt expense (S$ 6,000 x P28.20) P169,200

Amortization of patents (S$ 4,000 x P28.20) 112,800
Rent expense (S$ 10,000 x P28.20) 282,000
Total P564,000
Average rate (P28.20) is used to translate all expenses since this is a reasonable
estimation.

8
20-2: b

Machinery [(24,000 Ringgit ÷ 10) x P10.42] P 25,008

Average rate for the year is used in translating depreciation expense because this is more
reasonable estimation than the rate when the related asset was acquired (P4.80).

Forex loss on interest

Based on P 3,2000,000 P 120,000
Based on P 300,000,000 (P3,000,000x10%x4/12) 100,000 20,000
Forex loss P (220,000)

Total forex loss (P 8,000 + P220,000) P (228,000)

19-5: a.

Direct forex rate – Transaction date (P 1 ÷ $0.018) P 55.5555

Direct forex rate – Balance sheet date (P 1 ÷ $0.017) 58.8235
Direct forex rate – Settlement date (P 1 ÷ $0.020) 50.0000

Forex gain (loss), 2012

Transaction date ($10,000 x P55.5555) P 555,555
Balance sheet ($10,000 x P 58.8235) 588,235
Forex loss (increase) P ( 32,680)

Forex gain (loss), 2013

Balance sheet date ($10,000 x P58.8235) P 588,235
Settlement data ($10,000 x P 50.00) 500,000
Forex gain (decrease) P 88,235

CHAPTER 20

MULTIPLE CHOICES - COMPUTATIONAL

20-1: b

Bad debt expense (S$ 6,000 x P28.20) P169,200

Amortization of patents (S$ 4,000 x P28.20) 112,800
Rent expense (S$ 10,000 x P28.20) 282,000
Total P564,000
Average rate (P28.20) is used to translate all expenses since this is a reasonable
estimation.

20-2: b

Machinery [(24,000 Ringgit ÷ 10) x P10.42] P 25,008

Average rate for the year is used in translating depreciation expense because this is more
reasonable estimation than the rate when the related asset was acquired (P4.80).

Forex loss on interest

Based on P 3,2000,000 P 120,000

9
 Based on P 300,000,000 (P3,000,000x10%x4/12) 100,000 20,000
Forex loss P (220,000)

Total forex loss (P 8,000 + P220,000) P (228,000)

19-5: a.

Direct forex rate – Transaction date (P 1 ÷ $0.018) P 55.5555

Direct forex rate – Balance sheet date (P 1 ÷ $0.017) 58.8235
Direct forex rate – Settlement date (P 1 ÷ $0.020) 50.0000

Forex gain (loss), 2012

Transaction date ($10,000 x P55.5555) P 555,555
Balance sheet ($10,000 x P 58.8235) 588,235
Forex loss (increase) P ( 32,680)

Forex gain (loss), 2013

Balance sheet date ($10,000 x P58.8235) P 588,235
Settlement data ($10,000 x P 50.00) 500,000
Forex gain (decrease) P 88,235

CHAPTER 20

MULTIPLE CHOICES - COMPUTATIONAL

20-1: b

Bad debt expense (S$ 6,000 x P28.20) P169,200

Amortization of patents (S$ 4,000 x P28.20) 112,800
Rent expense (S$ 10,000 x P28.20) 282,000
Total P564,000
Average rate (P28.20) is used to translate all expenses since this is a reasonable
estimation.

20-2: b

Machinery [(24,000 Ringgit ÷ 10) x P10.42] P 25,008

CHAPTER 15
Price paid P350,000
Non-controlling interest (P350,000/80%) x 20% 87,500
Total 437,500
Less fair value of net assets excluding goodwill 330,000
Goodwill P107,500

10
15-6: a

Inventory (P360,000 + P130,000) P490,000

Plant and equipment (P500,000 + P420,000) P920,000

Less fair value of net assets acquired (P360,000 – P40,000) 320,000

Goodwill P 180,000

15-3: c

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

CHAPTER 15

MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

Price paid P4,000,000

Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

CHAPTER 15

11
 Plant assets – Pall Company (at book value) P 220,000
Plant assets – Mall Company (at fair value) 180,000

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

CHAPTER 15
Price paid P350,000
Non-controlling interest (P350,000/80%) x 20% 87,500
Total 437,500
Less fair value of net assets excluding goodwill 330,000
Goodwill P107,500

15-6: a

Inventory (P360,000 + P130,000) P490,000

Plant and equipment (P500,000 + P420,000) P920,000

Less fair value of net assets acquired (P360,000 – P40,000) 320,000

Goodwill P 180,000

15-3: c

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

CHAPTER 15

MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

12
 Price paid P4,000,000
Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

CHAPTER 15

MULTIPLE CHOICES - COMPUTATIONAL

15-1: d

Price paid P4,000,000

Less fair value of net assets acquired (P6,100 – P2,800) 3,300,000
Goodwill P 700,000

15-2: a

Price paid P 450,000

Non-controlling interest (P450,000/90%) x 10% 50,000
Total 500,000
Less fair value of net assets acquired (P360,000 – P40,000) 320,000
Goodwill P 180,000

15-3: c

Plant assets – Pall Company (at book value) P 220,000

Plant assets – Mall Company (at fair value) 180,000

CHAPTER 15

13
MULTIPLE CHOICES - COMPUTATIONAL

14