Barkley Ltd acquired a business for the following consideration:

Cash	$170,000
LandCarrying amount	$200,000
Shares in Barkley LtdFair value	$190,000

The business being acquired had the following assets and liabilities as reported in the balance sheet (there were no contingent liabilities):

Assets

• Plant and equipment $300,000
• Motor vehicle $150,000

Liabilities

• Bank loan $160,000
• Creditors $125,000

Required:

1. Compute the goodwill recognized at acquisition of the business. [8 Marks]

2. Journalize the required entries to record the recognition of goodwill and transfer of assets and liabilities at acquisition of the business. [7 Marks]