Hopkins Company is considering the acquisition of Richfield, Inc. To assess the amount it wght be willing to pay. Hopkins makes the following computations and mons A. Richfield, Inc. has identifiable assets with a total fair value of $6.000.000 and abilities of 53,700,000. The assets include office equipment with a turvaprung book value, buildings with a fair value 25% higher than book value and land with a fair value 50% higher than book value. The remerging lives of the assets are deemed to be approximately equal to those used by Richfield, Inc B. Richfield, Inc's pretax incomes for the years 2011 through 2013 were 5470,000, S570,000, and 5370,000, respectively. Hopkins believes that an average of these earnings represents a fair estimate of annual earnings for the indefinite future. However, it may need to consider adjustments for the following items included in pretax earrings Depreciation on Buildings (each year) 380,000 Depreciation on Equipment (each year) 30,000 Extraordinary Loss year 2013) 130,000 Salary Expense (each year) 170,000 C. The normal rate of return on net assets for the industry is 15 Required: A Assume that Hopkins feels that it must earn a 20% return on its investment, and that goodwil is determined by capitaluring excess earnings. Based on these assumptions calculate a reasonable offering price for Richfield, Inc Indicate how much of the price consists of goodwill B. Assume that Hopkins feels that it must earn a 151 return on its investment, but that average excess carings are to be capitalized for five years only. Based on these assumptions, calculate a reasonable offering price for Richfield, Inc. Indicate how much of the price consists of goodwill 2021- Shakir A Mraven Hopkins Company is considering the acquisition of Richfield, Inc. To assess the amount it wght be willing to pay. Hopkins makes the following computations and mons A. Richfield, Inc. has identifiable assets with a total fair value of $6.000.000 and abilities of 53,700,000. The assets include office equipment with a turvaprung book value, buildings with a fair value 25% higher than book value and land with a fair value 50% higher than book value. The remerging lives of the assets are deemed to be approximately equal to those used by Richfield, Inc B. Richfield, Inc's pretax incomes for the years 2011 through 2013 were 5470,000, S570,000, and 5370,000, respectively. Hopkins believes that an average of these earnings represents a fair estimate of annual earnings for the indefinite future. However, it may need to consider adjustments for the following items included in pretax earrings Depreciation on Buildings (each year) 380,000 Depreciation on Equipment (each year) 30,000 Extraordinary Loss year 2013) 130,000 Salary Expense (each year) 170,000 C. The normal rate of return on net assets for the industry is 15 Required: A Assume that Hopkins feels that it must earn a 20% return on its investment, and that goodwil is determined by capitaluring excess earnings. Based on these assumptions calculate a reasonable offering price for Richfield, Inc Indicate how much of the price consists of goodwill B. Assume that Hopkins feels that it must earn a 151 return on its investment, but that average excess carings are to be capitalized for five years only. Based on these assumptions, calculate a reasonable offering price for Richfield, Inc. Indicate how much of the price consists of goodwill 2021- Shakir A Mraven