P Corporation Issued 10,000 Shares of Common Stock with a Fair

Multiple Choice

P Corporation issued 10,000 shares of common stock with a fair value of $25 per share for all the outstanding common stock of S Company in a business combination properly accounted for as an acquisition. The fair value of S Company's net assets on that date was $220,000. P Company also agreed to issue an additional 2,000 shares of common stock with a fair value of $50,000 to the former stockholders of S Company as an earnings contingency. Assuming that the contingency is expected to be met, the $50,000 fair value of the additional shares to be issued should be treated as a(n) :

A) decrease in noncurrent liabilities of S Company that were assumed by P Company.
B) decrease in consolidated retained earnings.
C) increase in consolidated goodwill.
D) decrease in consolidated other contributed capital.