Company Purchase Analysis Gamma Corp. was incorporated on 1 January 2004 and acquired the business of Delta & Co. from 1 July 2003. The purchase price was $500,000, paid on 31 December 2003, with $25,000 interest. Below is the profit and loss account for the year ending 31 December 2004:

Account	Amount
Sales	600,000
Cost of goods sold	350,000
Gross profit	250,000
Wages and salaries	80,000
Rent	20,000
Distribution expenses	15,000
Interest paid to vendors	25,000
Depreciation	10,000
Miscellaneous expenses	10,000
Net profit	65,000

Required: a. Show the allocation of profits between pre- and post-incorporation periods. b. Prepare the journal entries for the acquisition. c. Calculate the goodwill arising from the acquisition.