Chapter 6 - UT Assets (10 points) Seved Help Save & Eelt Check 3 Assume that fast-food restaurants generally provide an ROI of 12%, but that such a restaurant near a college campus has an ROI of 15% because its relatively large volume of business generates an above-average turnover (sales/assets). The replacement value of the restaurant's plant and equipment is $600,000. If you were to invest that amount in a restaurant elsewhere in town, you could expect a 12% ROI 0.83 points Required: --1. Would you be willing to pay more than $600,000 for the restaurant near the campus? BOOM Yes 00 No a 2. What is the maximum price you would be willing to pay for the business? Hun Macomum Price b. If you purchased the restaurant near the campus for $750,000 and the fair value of the assets you acquired was $600,000, Identity the account along with its balance that is used to record the additional amount paid over the fair value of the sets Chapter b-U1 Assets 10 Points) U Help Save an Suo Check my work 4 Goodwill arises when one firm acquires the net assets of another firm and pays more for those net assets than their current fair value, Suppose that Target Co, had operating Income of $62,300 and net assets with a fair value of $172,000 Takeover Co. pays $313,000 for Target Co.'s net assets and business activities 0.83 points Required: a. How much goodwill will result from this transaction? Goodwil PM b. Calculate the ROI for Target Co. based on its present operating Income and the fair value of its net assets. (Round your percentage answer to 2 decimal places.) References ROI c. Calculate the Rol that Tokeover Co. will can the operating Income of the acquired not onets continues to be $62,300 (Round your percentage answer to 2 decimal places) FLON