E$2\mathrm{.}6$ Goodwill and Bargain Purchase Panda Corporation paid $$2,000,000$ in cash for all of Sim Corpora$-$

LO $1,4$

tion's assets and liabilities in a merger. The following table shows three possible cases for the merger:

Required

In each of the above cases, prepare the journal entry Panda makes to record the acquisit Goodwill Calculation

Purchase Price $$2,000,000\mathrm{.}00$

BV $$3,500,000\mathrm{.}00$

Purchase Premium $$11,500,000\mathrm{.}00$

Subtract difference in FMV and BV of net assets $$21,000,000\mathrm{.}00$

Goodwill $$9,400,000\mathrm{.}00$

Subtract difference in FMV and BV of net assets: $$2,100,000$ BV$$ FMV$$ Difference$35\%$ Life$$ Amortization$$

Patents $02,000,0002,000,000700,00010$ years$70,000$

Unreported Tech$04,000,0004,000,0001,400,0005$ years$280,000$

$6,000,0002,100,000350,000$