I just need to know how to calculate the goodwill of 232,000. If you could do the A entry wich is writing the assets up to fair value and explain how you came up with the numbers.
Thanks
Show all steps :-Chapter 4, Problem 28P (3 Bookmarks) ON Problemm Plaza, Inc, acquires 80 percent of the outstanding common stock of Stanford Corporation on January 1, 2018, in exchange for $900,000 cash. At the acquisition date, Stanford's total fair value, including the noncontrolling interest, was assessed at $1,125,000. Also at the acquisition date, Stanford's book value was $690,000 Several individual items on Stanford's financial records had fair values that differed from their book values as follows Tradenames (indefinite life) Property and equipment (net, 8-year Book Value Fair Value $360,000 $383,000 330,000 290,000 3 remaining life) Patent (14-year remaining life) 132,000 272,000 For internal reporting purposes, Plaza, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies. Plaza Stanford Revenues Cost of goods sold Depreciation expense Amortization expense $(1,400,000) (825,000) 395,750 36,250 28,000 774,000 328,000 80 Net income Retained earnings, 1/1/18 Net income Dividends declared. $(578.000 (365.000 $(1,275,000) (530,000) (365,000) 50,000 578,000) 300,000 $1.553000 845,000) Retained earnings, 12/31/18 Current assets Investment in Stanford 432.250 $ 860,000 1.140,000 240,000 1,030,000 360,000 253,750 104,000 $1.150,000 $ (142,000) (145,000 (120,000) (40,000) (845,000) Property and equipment (net) Patents Total assets Accounts payable Common stock Additional paid-in capital Retained earnings (above). $3,270,000 (300,000) (1.275,000) (1,553,000) Total liabilities and equities $(3,270 (1,150 Show all steps :-Chapter 4, Problem 28P (3 Bookmarks) ON Problemm Plaza, Inc, acquires 80 percent of the outstanding common stock of Stanford Corporation on January 1, 2018, in exchange for $900,000 cash. At the acquisition date, Stanford's total fair value, including the noncontrolling interest, was assessed at $1,125,000. Also at the acquisition date, Stanford's book value was $690,000 Several individual items on Stanford's financial records had fair values that differed from their book values as follows Tradenames (indefinite life) Property and equipment (net, 8-year Book Value Fair Value $360,000 $383,000 330,000 290,000 3 remaining life) Patent (14-year remaining life) 132,000 272,000 For internal reporting purposes, Plaza, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies. Plaza Stanford Revenues Cost of goods sold Depreciation expense Amortization expense $(1,400,000) (825,000) 395,750 36,250 28,000 774,000 328,000 80 Net income Retained earnings, 1/1/18 Net income Dividends declared. $(578.000 (365.000 $(1,275,000) (530,000) (365,000) 50,000 578,000) 300,000 $1.553000 845,000) Retained earnings, 12/31/18 Current assets Investment in Stanford 432.250 $ 860,000 1.140,000 240,000 1,030,000 360,000 253,750 104,000 $1.150,000 $ (142,000) (145,000 (120,000) (40,000) (845,000) Property and equipment (net) Patents Total assets Accounts payable Common stock Additional paid-in capital Retained earnings (above). $3,270,000 (300,000) (1.275,000) (1,553,000) Total liabilities and equities $(3,270 (1,150
