"EiLr:io.

73s-eao7 e 734-3949
\#
AD\TANCED I'INANCIAI. ACCOU}{TTNG C REPORTING ,fu1y 16, 2AL7
First Pre-board Exam-ination 03 :OOPM - 06:00PM
Set A
MU]. e Choice
truction: Select the correct each of the following questicns.
answer for
Mark only one ansr/ier for each item to the box co-rl:esponding tc your choice
on the answer sheet provided' Strictly no erasul:es are allowed' Use pencil
no. 2. Computations are n9t-n9t!:"alY:
rteu.s 1 to 5 are based on the following 1"1""4*Tr.=> i r s conLrnon sr_ock
On January 1, 20x4, NT Company exchanges {::UUU snares- ^, rL:
or
of OfC. fnc' f''aZn of NT's shares has a
for alf of the assets ano lrabilitles of the stock exchansed in
,.ii'"]5r";"""",,l";F;;;;ii-r"r"". rhe fai-r value
til;"e;,o"r=rr;;;s s?"1r ro _orG's rair varue- Nr drso paid
"";;;dered
(125-,000: :-n stock regisrratl"l .,"d rl?.=r??"q _."ljl , i"
' ^r-,,i:i;tron with the
merger i1 ,'ll. -- - .i.'.lt
'.--rrdi,f .,,-, t.
Several of s accounts have ru.t s" tha;'+t* 'tl' hi their book
orG, " '
val-ues on thi-s date:

Pre-combination JanuarY l, 2Ax4, book values for the two companies are as

follows:
N]
Cosh .
P 60.000
150,000
Receivobles
400,000
Irodemorks I
'I
840,O00
1: Record music cololog . . .
Ectuipmenl {nei) . . ___:,?a-@q
Totols . . ?),zgas?
Accounts poyoble P I 10,000
370,000
Notes poyobie
400,000
Common stock .
30.000
Addilionol poid-in coPiiol
860.000
Retoined eornings

Assume that thj-s combinati-on is a statqtory- -]n-erger so that oTG's and

accounts
will no
will be transferred to the records of NT- oTG will- be dissolved
longerexistasalegalentity.Immediate}ythebusinesscombinationusing
the g-equj.s-it|on- m.etbod, det ermine :
1
1. The total assets amounted to:
\
A. P2, L24 , OOO c. P2,57 4,000
B. P2,547,000 D. P2,599,000
,D
2- The common stock amounted to:
A. P 50,000 c. P4 50, 000
B. P400,000 D. P460.000
3. The additional paid-in capital amounted to:
c' p695,000
A- P 30,000
B. P 60,000 D. P120'Aoo
4. The retained earnlngs amounted to:
A. P190,000 c. P 860' 000
B. P835,000 D' Pl, o5o' oo0
5" Alf and Ben, partners in Alf & Ben Partnership who -s.iadre- net income anci
balances of 'g-40,000 and P6C, CCC,
losses equally, had capital account the fo-ll-owing journaf
respectively, on September 25, 2Ax1, on which date
entry wast prepared for the partnership: -^ n A^
OZ, UUU
Cash
Goodwill | (P62, 000 x 3) (P100,000 + P62,000) l 24, O00
12, 000
Alf, CaPltal (P24,000 x 0-50) L2, AAA
Ben, CaPi-tal (P24,000 x 0.50) 62, CCC
Cam, CaPitai
To record inYestmenl by Cam for a one-tn7rd ;nterest tn
c:'.'- j=c y bet-ween
capitai-, wt th gccaw: ) : cf ?21, OCI =suai-t
tlF ^-ai a=-.