E12.11B (LO 3) (Accounting for Goodwill) Palmer, owner of Palmer Interiors, is negotiating for the purchase of Ruth Inc. The balance sheet of Ruth Inc. is given in an abbreviated form, as follows: Assets Cash $ 240,000 Land 168,000 Buildings (net) 470,000 Equipment (net) 420,000 Copyrights (net) 82.000 Total assets S1.380.000 PALMER INTERIORS BALANCE SHEET AS OF DECEMBER 31, 2020 Liabilities and Stockholders' Equity Accounts payable Long-term notes payable Total liabilities Common stock $430,000 Retained earnings 60.000 Total liabilities and stockholders' equity $ 120,000 720.000 840,000 540.000 51.380.000 Palmer and Ruth agree that: 1. Land is undervalued by $72,000. 2. Equipment is overvalued by $12,000. Ruth agrees to sell the business to Palmer for $740,000. Instructions Prepare the entry to record the purchase of Ruth Inc. on Palmer's books