Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Goggle Inc. acquired a new division, Metavision on Oct 20th 2021. The fair market value for the assets and liabiltiies for Metavision on the date
Goggle Inc. acquired a new division, Metavision on Oct 20th 2021. The fair market value for the assets and liabiltiies for Metavision on the date of acquisition is as follows: Current assets 140000 PPE (net) 280000 Intangibles 150000 Current liabilities 190000 Long-term liabilities 220000 Goggle Inc. paid $200,000 for the acquisition of Metavision. 10% of this purchase price goes towards in-process R&D. Metavision becomes a fully owned reporting unit under Goggle Inc. On Dec 31st 2021, Goggle Inc. prepares their financial statements. Assuming that Goggle Inc. has not made any other acquisition, what is the amount of goodwill that Goggle Inc. reports on their balance sheet (prior to any impairments)? (4 points) On Dec 31st 2021, the book value of Metavision's net assets, including the goodwill, is $130,000. The fair market value of Metavision is $120,000. The fair market value of the net assets of the Metavision reporting unit is $90,000. Should Goggle Inc. recognize goodwill impairment? If so, provide the journal entries for this goodwill impairment. (6 points)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started