Question
Courageous Company (parent) paid $1,890,000 for 80% of the outstanding voting shares of Compassionate Company (subsidiary). On the day of acquisition, Compassionate Company had the
Courageous Company (parent) paid $1,890,000 for 80% of the outstanding voting shares of Compassionate Company (subsidiary). On the day of acquisition, Compassionate Company had the following assets and liabilities:
Book ValueFair Value
Current Asset975,000 975,000
Non-Current Asset1,155,0001,365,000
Current Liabilities(210,000)(210,000)
Non-Current Liabilities(450,000)(450,000)
Required:
How much should be reported as Goodwill - Partial as a result of the shares acquisition?
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Accounting for Governmental and Nonprofit Entities
Authors: Jacqueline L. Reck, James E. Rooks, Suzanne Lowensohn, Daniel Neely
18th edition
1260190080, 1260190083, 978-1259917059
