E1-2 [Based on AICPA) General problems 1. Pop Corporation paid $100,000 cash for the net assets of Son Company, which consisted of the following: Book Value Fair Value Current assets Plant and equipment Liabilities assumed $ 40,000 160,000 (40,000) $160,000 $ 56,000 220,000 (36,000) $240,000 Assume Son Company is dissolved. The plant and equipment acquired in this business combination should be recorded at: a $220,000 b $200,000 C $183,332 d $180,000 2. On April 1, Pam Company paid $1,600,000 for all the issued and outstanding common stock of Sun Corporation in a transaction properly accounted for as an acquisition. Sun Corporation is dissolved. The recorded assets and liabili- ties of Sun Corporation on April 1 follow: $160,000 480,000 Cash Inventory Property and equipment (net of accumulated depreciation of $640,000) Liabilities 960,000 (360,000) On April 1, it was determined that the inventory of Sun had a fair value of $380,000, and the property and equipment (net) had a fair value of $1,120,000. What is the amount of goodwill resulting from the acquisition? a 0 b $100,000 C $300,000 d $360,000