Abbington inc. purchases all of the common stock of frederick company for $315000 cash. at the acquisition date, frederick's stockholders' equity consisted of common stock , $150000, and retained earings. $60000. it was determined that the investee's balance sheet included land undervalued by $50000 and equipment undervalued by $10000. abbington estimates a 10 year life for any goodwill.

Required:

a. What is the amount of goodwill recorded at date of acquisition?

b. What is the balance in goodwill one year after acquisition? ( is there more than one answer and provide narrative if needed?)