Exercise 1-2 Alpha Company is considering the purchase of beta Company. Alpha has collected the following data about Beta: Beta Company Estimated Book Values Total identifiable assets Total liabilities Owners' equity $631,600 288,700 $342,900 Market Values $735,800 328,300 Cumulative total net cash earnings for the past five years of $927,700 includes extraordinary cash gains of $69,800 and nonrecurring cash losses of $44,300. Alpha Company expects a return on its investment of 13%. Assume that Alpha prefers to use cash earnings rather than accrual-based earnings to estimate its offering price, and that it estimates the total valuation of Beta to be equal to the present value of cash-based earnings (rather than excess earnings) discounted over five years. (Goodwill is then computed as the amount implied by the excess of the total valuation over the identifiable net assets valuation.)