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1. Pillow Company acquired 80 percent ownership of Sheet Company on January 1,208 for $173,000. At that date, the fair value of the noncontrolling interest
1. Pillow Company acquired 80 percent ownership of Sheet Company on January 1,208 for $173,000. At that date, the fair value of the noncontrolling interest was $43,250. 2. On January 1, 20X8, Sheet reported net assets with a book value of $150,000 and a fair value of $191,250. The difference between fair value and book value of Sheet's net assets is as follows: 3. Accumulated Depreciation on buildings and equipment was $75,000 on the acquisition date. 4. At December 31, 20X8, Pillow's management reviewed the amount attributed to goodwill and concluded goowill was impaired and should be reduced to $23,000. Goodwill and goodwill impairment were assigned proportionately to the controlling and noncontrolling shareholders. 5. Pillow used the equity method in accounting for its investment in Sheet. 6. Detailed analysis of receivables and payables showed that Pillow owed Sheet $9,000 on December 31,208
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