Question
Bot, Inc. had the following balance sheet on January 1, Year 1: Assets Liabilities & Equity Cash $ 50,000 Accounts Payable $ 25,000 Property, Plant
Bot, Inc. had the following balance sheet on January 1, Year 1:
| Assets | Liabilities & Equity | ||
| Cash | $ 50,000 | Accounts Payable | $ 25,000 |
| Property, Plant & Equipment | 450,000 | Notes Payable | 260,000 |
| Patents | 15,000 | Stockholders Equity | 230,000 |
|
| $515,000 |
| $515,000 |
On January 2, Year 2, Purchaser, Inc. acquired Bot for $800,000 cash. On that date, Bots property, plant, and equipment had a fair value of $420,000, and its Patents had a fair value of $125,000. In addition, Bot had research and development with an assessed value of $150,000. For all other amounts, the book value of January 1, Year 2, equaled fair value. Compute the goodwill resulting from the purchase of Bot.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Auditing Markets Products And Marketing
Authors: David Parmerlee
1st Edition
0658001337, 978-0658001338
