Macy€™s, Inc., is one the nation€™s premier retailers, with fiscal 2010 sales of $25 billion. The company operates about 810 Macy€™s department stores and furniture galleries. In 2005, Macy€™s acquired May Department Stores, Inc. Excerpts from the notes to the financial statements for the year ended January 31, 2009, provide details about the purchase and intangible assets.

Note 2: Acquisition
The aggregate purchase price for the merger with May (the €œMerger€) was approximately $11.7 billion, including approximately $5.7 billion of cash and approximately 100 million shares of Company common stock. The value of the approximately 100 million shares of Company common stock was determined based on the average market price of the Company€™s stock from February 24, 2005 to March 2, 2005. In connection with the Merger, the Company also assumed approximately $6.0 billion of May debt.
The May purchase price has been allocated to the assets acquired and liabilities assumed based on their fair values, and is subject to the final fair value determination of certain assets and liabilities. The following table summarizes the preliminary purchase price allocation at the date of acquisition:

Note 8: Goodwill
During 2008, the Company recorded a goodwill impairment charge of $5,382 million based on the result of goodwill impairment testing as of January 31, 2009.

Requirements
1. Prepare the entry (in millions) to record the purchase of May Department Stores.
2. Record the 2008 impairment ofgoodwill.

Transcribed Image Text:

Current assets, excluding assets of discontinued operations Assets of discontinued operation Property and equipment Goodwil Intangible assets Other assets (millions) S 5,288 2,264 6,579 8,946 679 31 23,787 (12,038) 11,749 Total assets acquired Total liabilities assumed Total purchase price Jan 31, Jan 31,Jan 31, 2008 2009 2007 Non-amortizing intangible assets Goodwill and tradenames $9,610 $9,691