A B C On July 31, 2019, Mexico Company paid $4,150,000 to acquire all of the common stock of Conchita incorporated, which became a division of Mexico. Conchita reported the following balance sheet at the time of the acquisition. Current assets $800,000 Current liabilities $600,000 Noncurrent assets $2,700,000 Long-term liabilities $500,000 $3,500,000 Stockholders' equity $2,400,000 Total liabilities and stockholders' equity | $3,500,000 8 it was determined at the date of the purchase that the fair value of the identifiable net assets of Conchita was 9 $2,850,000 Over the next 6 months of operations, the newly purchased division experienced operating 10 losses. In addition, it now appears that it will generate substantial losses for the foreseeable future. At December 31, 2019, Conchita reports the following balance sheet information. 12 Current assets $500,000 13 Noncurrent assets (including goodwill recognized in purchase) $2,500,000 14 Current liabilities ($800,000) 15 Long-term liabilities ($500,000) 16 Net assets $1,700,000 17 It is determined that the fair value of the Conchita Division is $1,850,000 The recorded 18 amount for Conchita's net assets (excluding goodwill) is the same as fair value, except for property, plant, 19 and equipment, which has a fair value $350.000 above the carrying value. 20 21 Instructions: 22 (a) Compute the amount of goodwill recognized, if any, on July 31, 2019. 27 (b) Determine the impairment loss, if any, to be recorded on December 31, 2019 28 29 30 31 32 (c) Assume that fair value of the Conchita Division is $1,450.000 instead of 33 Determine the impairment loss, if any, to be recorded on December 31, 2019 34 $1,850,000