Abby Co. acquired all of the outstanding stock of Agnes Co. by issuing 100,000 shares of its P1 par value stock. The shares have a fair value of P15 per share. Abby Co. also paid P25,000 in direct acquisition costs. Prior to the transaction, the companies have the following balance sheets: Assets Abby Co. Agnes Co. Cash P 150,000 P 50,000 Accounts receivable 500,000 350,000 Inventory 900,000 600,000 Property, plant, and equipment (net) 1,850,000 900,000 Total assets P3,400,000 P1,900,000 Liabilities and Stockholders' Equity Current liabilities P 300,000 P 100,000 Bonds payable 1,000,000 600,000 Common stock (P1 par) 300,000 100,000 Paid-in capital in excess of par 800,000 900,000 Retained earnings 1,000,000 200,000 Total liabilities and equity P3,400,000 P1,900,000 The fair values of Agnes Co.'s inventory and plant, property and equipment are P700,000 and P1,000,000, respectively. The journal entry to record the purchase of Agnes Co. would include aGroup of answer choices credit to common stock for P1,500,000. debit to investment for P1,525,000 credit to additional paid-in capital for P1,100,000. debit to investment for P1,500,000 Goodwill associated with the purchase of Agnes Co. is ____.

Abby Co. acquired all of the outstanding stock of Agnes Co. by issuing 100,000 shares of its P1 par value stock. The shares have a fair value of P15 per share. Abby Co. also paid P25,000 in direct...

Abby Co. acquired all of the outstanding stock of Agnes Co. by issuing 100,000 shares of its P1 par value stock. The shares have a fair value of P15 per share. Abby Co. also paid P25,000 in direct acquisition costs. Prior to the transaction, the companies have the following balance sheets:

Assets	Abby Co.	Agnes Co.
Cash	P 150,000	P 50,000
Accounts receivable	500,000	350,000
Inventory	900,000	600,000
Property, plant, and equipment (net)	1,850,000	900,000
Total assets	P3,400,000	P1,900,000

Liabilities and Stockholders' Equity
Current liabilities	P 300,000	P 100,000
Bonds payable	1,000,000	600,000
Common stock (P1 par)	300,000	100,000
Paid-in capital in excess of par	800,000	900,000
Retained earnings	1,000,000	200,000
Total liabilities and equity	P3,400,000	P1,900,000

The fair values of Agnes Co.'s inventory and plant, property and equipment are P700,000 and P1,000,000, respectively.

The journal entry to record the purchase of Agnes Co. would include a

Group of answer choices

credit to common stock for P1,500,000.

debit to investment for P1,525,000

credit to additional paid-in capital for P1,100,000.

debit to investment for P1,500,000

Goodwill associated with the purchase of Agnes Co. is ____.

Jun 10, 2022

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Abby Co. acquired all of the outstanding stock of Agnes Co. by issuing 100,000 shares of its P1 par value stock. The shares have a fair value of P15 per share. Abby Co. also paid P25,000 in direct...

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