STOCK ACQUISITION Acquiree - Binili Subsidiary (Non-Controlling Interest) Acquirer - Bumili Parent (Controlling Interest) 51% and Above

ove - Dapat yung pinurchase 1. DETERMINE GOODWILL Cost of Investment PP of Cash PP of Stocks @FV PP of NCA Contingent Consideration FMV of NCI FMV of Previously Held Securities COI (Cost of Investment) IF:

vs.

FMV of NIA Assets excluding GW @FMV Less: Liabilities @FMV FMV of NIA

COI > FMV = Goodwill COI < FMV = Income from Acquisition

2 Methods of getting FMV of NCI 1. Proportionate Share Basis CNCINA (Partial Goodwill Method) 2. Fair Value Method Silent / Pag sinabi na measured at FV a. Given b. Assume c. Check i. Assumed Value = Purchase Price x NCI% CI% ii. CNCINA = FMV of NIA x NCI% 2. WORKING PAPER ENTRIES (1) Eliminate SHE (2) Update Assets of Subsidiary to FMV (3) Recognize Goodwill
Proportionate Share Basis FMV of NCI 1. Given Fair Market Value Method 2. Assumed CNCINA

Whichever is higher.

FMV of NIA x NCI%

3. Check CNCINA w/c ever is higher. (Given vs. Check; Assumed vs. Check)

Kanino yung Goodwill?

Parent Full Goodwill Partial Subsidiary
Goodwill Given Determination and allocation schedule Assumed Simple (Ratio)

Parent
CNCINA

Parent

Determination and Allocation Schedule GOODWILL CI COI PP in Cash FMV - Less: FMV of NIA (CI%) xx

NCI FMV of NCI FMV of NIA (NCI%) xx

ERIKA MAE ARMES RELLORES