On May 28, 2018, Pesky Corporation acquired all of the outstanding common stock of Harman, Inc for $420 million The fair value of Harman 's identifiable tangible and intangible assets totaled $512 million, and the fair value of liabilities assumed by Pesky was $150 million Pesky performed a goodwil...

Requirement 1 Calculation of goodwill Consideration exchanged 420 million Less fair v ...

On May 28, 2018, Pesky Corporation acquired all of the outstanding common stock of Harman, Inc. for

Question:

On May 28, 2018, Pesky acquired all of the outstanding of Harman, Inc. for $420 million. The fair value of Harman's identifiable tangible and totaled $512 million, and the fair value of liabilities assumed by Pesky was $150 million.
Pesky performed a impairment test at the end of its fiscal year ended December 31, 2018. Management has provided the following information:
Fair value of Harman, Inc. .................................................. $400 million
Fair value of Harman's net assets (excluding ) ................ 370 million
Book value of Harman's net assets (including ) ................ 410 million
Required:
1. Determine the amount of that resulted from the Harman acquisition.
2. Determine the amount of impairment loss that Pesky should recognize at the end of 2018, if any.
3. If an impairment loss is required, prepare the journal entry to record the loss.
Goodwill
Goodwill is an important concept and terminology in accounting which means good reputation. The word goodwill is used at various places in accounting but it is recognized only at the time of a business combination. There are generally two types of... Intangible Assets
An intangible asset is a resource controlled by an entity without physical substance. Unlike other assets, an intangible asset has no physical existence and you cannot touch it.Types of Intangible Assets and ExamplesSome examples are patented... Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...