During 2014, the Pencil Corp. entered into negotiations to buy Stilo Company, finally agreeing on a final cash purchase price of $534,000. Pencil will acquire all assets and liabilities of Stilo effective 31 December 2014, except for the existing cash balances of Stilo. The 31 December 2014 balance sheet prepared by Stilo is shown below in column (a), and the revised fair values added later by Pencil are shown in column (b). STILO COMPANY BALANCE SHEET At 31 December 2014 (a) Book Values of Stilo b) Fair Values by Pencil Cash 50,000 n/a Accounts receivable (net) 106,000. $ 108,000 Inventory 320,000. 180,000 Property, plant, and equipment (net) 618,000. 570,000 Land 22,000. 80,000 Franchise (unamortized balance) 38,000. 42,000 Total $1,154,000 Liabilities and shareholders' equity Current liabilities $ 74,000. 74,000 Bonds payable 400,000. 400,000 Shareholders' equity 680,000. n/a Total $1,154,000 1. Compute the amount of goodwill purchased by Pencil. 2. Give the entry for Pencil to record the purchase of Stilo