Cornerstone Company purchased the most popular pub in a college town. The purchase price was $1,500,000. The appraisers determined that the land should be valued at $400,000, the building at $500,000 and the equipment at $200,000. Which of the following statements is correct? A. The company should record only the appraised value of the assets. B. The company needs to adjust the value of the assets in proportion to their appraised value so that the total of the assets equals the purchase price. C. The company paid too much for the business and needs to record a loss. D. The company needs to record goodwill of $400,000.

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the answer is D