Answer the question below and give supporting solutions.

What is the total amount of assets to be reported by the surviving company? a. P7,015,000 c. P7,118,000 b. P6,980,000 d. P7,491,000

Problem 1: On October 1, 2033, FRED Corporation acquired all the assets and assumed all the liabilities of CHENG Company by issuing 20,000 shares with a fair value of P67.5 per share and an obligation to pay a contingent consideration with a fair value of P750,000. In addition, FRED paid the following acquisition related costs: The Statement of Financial Position as of September 30, 2033 of FRED and CHENG, together with the fair market value of the assets and liabilities are presented below: Compute for the balances that will be shown on the October 1, 2033 statement of financial position of the surviving company