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Cincinnatus Company paid $5,000,000 to acquire the Sprayer Corporation which became a division of Cincinnatus. The acquisition wastinalized January 1, 2016. Sprayer reported the following
Cincinnatus Company paid $5,000,000 to acquire the Sprayer Corporation which became a division of Cincinnatus. The acquisition wastinalized January 1, 2016. Sprayer reported the following balance sheet at the time of the acquisition Current assos $500,000 Noncurrent assets 1.700.000 Total assets 34200.000 Currenties $250,000 Long-termos 350,000 Stockholders equity 1.800.000 Total abilities and stockholders equity $5.200.000 At the date of the purchase the fair value of the identifiable net assets of proyer was $4,675,000, Al December 31, 2016. Sprayer reports the following balance sheet information: Current assets Noncurrent assets (including good recognized in purchase) Current is Long term abilities Stockholders' Equity DR CRI $500,000 4.000.000 (450,000) (500.000) (4,500,000) The 12/31/16 fair value of the Sprayer division was determined to be 54.375,000. The recorded amount for Sproyer's net assets (excluding goodwill) is the same as fair value, except for property, plant and equipment, which has a fair value of 575.000 above the carrying value On 12/31/16. Goodwill reported on the balance sheet is Select one 5200,000 Ob $125.000 5275 000 od 550.000 525.000
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