Luthby Corp. purchased the net assets of Cranston Company on December 31, 2020 for 1915.000 The following is the balance sheet for Cranston Company on that date: Cranston Company Balance Sheet As at December 31, 2020 Assets Liabilities & S/H Equity Accounts Receivable Inventory Long-Term Investments Plant & Equipment (net) $340,000 100,000 120,000 360,000 $920.000 Accounts Payable Bonds Payable Common Stock Retained Earnings $120,000 250,000 10,000 540,000 $920.000 Additional data: 1. The inventory is overvalued by $10,000. 2. The long-term investments are undervalued by $75,000. 3. The plant & equipment is overvalued by $45,000 4. All other assets and liabilities have fair values that are equal to their carrying amounts Restate net assets at historical cost to fair market value. % 7 A B 1 Calculate the amount of goodwill that Luthby Corp will record upon the purchase of the assets of Cranston Company A B I Prepare the journal entry at December 31, 2020 to record the purchase of the net assets by Luthby Corp. 8 SS 7 - General Journal Crerit Nehit What are two factors that could result in a company purchasing another company for an amount greater than the fair market value of the net assets which would result in goodwill? 7 " B 1 E E % 53