What is the maximum term of the measurement period?
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- 18 If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the acquirer shall report in its financial statements provisional amounts for the items for which the accounting is incomplete. What is the maximum term of the measurement period? Group of answer choices 6 months from the acquisition date No maximum term is provided in the standard 12 months from the acquisition date 3 months from the acquisition date9. Dynamite Company acquired rights to a patent under a licensing agreement that required an advance royalty payment when the agreement was signed. The entity remitted royalties earned Page 6 of 7 and due under the agreement on October 31 each year. Additionally, on the same date, the entity paid, in advance, estimated royalties for the next year. The entity adjusted prepaid royalties at the end of the year. The entity provided the following information for the year ended December 31, 2020: P 650,000 1,100,000 250,000 On December 31, 2020, what amount should be reported as prepaid royalties? 1/1 Prepaid royalties Royalty payment (charged to royalty expense) Year-end credit adjustment to expense 10/31 12/31Statement I: In a business combination achieved in stages, the resulting gain or loss from the remeasurement of the acquirer’s previously held equity interest to its acquisition-date fair values shall be recognize in profit or loss or other comprehensive income.Statement II: The measurement period shall not exceed one year from the acquisition date. a. True, False b. False, False c. True, True d. False, True
- SM Company acquired rights to a patent under a licensing agreement that required an advance royalty payment when the agreement was signed. The entity remitted royalties earned and due under the agreement on October 31 each year. Additionally, on the same date, the entity paid, in advance, estimated royalties for the next year. The entity adjusted prepaid royalties at the end of the year. The entity provided the following information for the year ended December 31, 2020: 1/1 Prepaid royalties P 650,000 10/31 Royalty payment (charged to royalty expense) 1,100,000 12/31 Year-end credit adjustment to expense250,000 On December 31, 2020, what amount should be reported as prepaid royalties?4. An entity acquired an investment in equity instrument for P800,000 on 31 March 2020. The direct acquisition costs incurred were P140,000. On 31 December 2020 the fair value of the instrument was P1,100,000 and the transaction costs that would be incurred on sale were estimated at P120,000. If the investment is designated as FA@FVTOCI, what gain would be recognized in the financial statements for the year ended 31 December 2020? Group of answer choices Nil P40,000 P160,000 P420,000odwill to be amortized periodically for 20 years. G. Goodwill to be amortized for 40 years D. Expenses immediately. B. Goodwill not subject to amortization but subject to impairment. 3. Two methods of arranging business combinations: C. Acquisition and uniting of interest D. Merger and acquisition of stocks A/ Merger and consolidation B. Consolidation and Acquisition of stocks . The cost of registering equity securities in a business combination should be recorded as: A. An income of the period B. An expense of the period C. Deduction from additional paid-in capital D. Part of the cost of the stock acquired 5. In acquisition-type combination, the appropriate accounting for the excess of fair values of net assets acquired er the price paid is to: A. Recognize as income in the books of the acquirer B. Recognize as additional paid-in capital in the books of the acquirer blbe C. Reduce proportionately current fair values assigned to the acquiree's non-current assets any remaining excess as…
- Problem 15-5 (IAA) Prepare journal entry to record the sale`of ABC ordinary statement of financial position on January 1, 2020: Aborigine Company reported the following accounts in the share on July 1, 2021. Market adjustment for unrealized loss the change in fair value. 3. Prepare journal entry on December 31, 2021 to recognize A tement of hnancial position on January 1, 2020: Noncurrent assets Financial asset –FVOCI Market adjustment for unrealized loss 4,000,000 ( 500,000) Market value 3,500,000 Other comprehensive income Unrealized loss ( 500,000) An analysis of the investment portfolio revealed the following on December 31, 2020. Cost Market XYZ ordinary share ABC ordinary share RST preference share 1,000,000 2,500,000 500,000 1,200,000 2,000,000 200,000 4,000,000 3,400,000 On July 1, 2021, the ABC ordinary share was sold for P2,100,000. On December 31, 2021, the remaining investments have the following market value: XYZ ordinary share RST preference share 1,000,000 150,000…Prepare an ECOBV amortization schedule at the date of acquisition What is the amount of gross profit to be deferred in 2021? What consolidation entries are needed at the end of 2021?Requirements: a. How much would Lexicon record as amortization expense for this patent for the year ending December 31, 20x5? b. How much is the carrying of the patent on December 31, 20x5?
- ASAPClassification 1. An entity invests in a pool of assets that is managed by an investment house. In accordance with the entity's business model, the investment will be held until it matures in 10 years' time, at which date the entity will collect the principal amount in the investment together with the interest earned. In accordance with the principles of PFRS 9, the entity will most likely measure the investment at c. FVOCI (Mandatory). d. FVOCI (Election). a. Amortized cost. b. FVPL. 2. An entity plans to purchase a new machine in a few years' time. The cost of the new machine is significant. To address this, the entity invests in debt securities. The entity's investment management strategy is to hold the investment and collect the investment income in the form of interest. However, when opportunity arises, the entity sells the investment in order to realize fair value gain. The entity reinvests any proceeds from sales until the date of purchase of the new machine. In accordance with…Provide the 2020 adjusting journal entry (both accounts and amounts) that Newell Brands made to record amortization on its finite-lived Intangible Assets. Assume that Newell Brands makes one adjusting journal entry for amortization expense at the end of each fiscal year as part of its adjusting entries
