26

On 31/12/2008, M Co acquired 100% ownership of S Co. On that date, S reported assets and liabilities with book values of $300,000 and $100,000, respectively, common stock outstanding of $50,000, and retained earnings of $150,000. The book values and fair values of S assets and liabilities were same except land which had increased in value by $10,000 and inventories which had decreased by $5,000 Based on the preceding information,

what amount of goodwill will be reported if the acquisition price was $240,000?

Select one: a. 35,000 b. 40,000 c. 0 d. 15,000

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On 1/1/2020, P Inc.acquired all of S Inc.s common shares for cash equal to the

stocks book value.The book value amounts of S assets and liabilities approximated their fair values, except that its building book value was more than fair values,In preparing P 2020 consolidated income statement

which of the following adjustments would be made?

Select one: a. Increase depreciation expense b. Decrease depreciation expense c. no entry d. adjustments for gain