Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On 1 February 2023, WAT Ltd issues shares with a fair value of $200 000 as consideration for the acquisition of a business division

 

On 1 February 2023, WAT Ltd issues shares with a fair value of $200 000 as consideration for the acquisition of a business division from ER Ltd. The recorded assets acquired were as follows. Records of ER Ltd Fair Value $50 000 $70 000 25 000 35 000 $75 000 $ 105 000 Warehouse Inventories Net assets The business sale agreement includes the existing customer contracts of ER Ltd. These contracts are not included in ER Ltd's accounting records and have a fair value of $80 000. What is the amount of goodwill that WAT Ltd will recognise for business combination?

Step by Step Solution

3.34 Rating (151 Votes )

There are 3 Steps involved in it

Step: 1

To calculate the amount of goodwill that WAT Ltd will reco... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals of Advanced Accounting

Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik

6th edition

0-07-786223-6, 101259095592, 13: 978-0-07-7, 13978125909559, 978-0077862237

More Books

Students also viewed these Accounting questions

Question

How should LearnInMotion.com implement a global HR system? LO.1

Answered: 1 week ago

Question

What applied experiences do you have? (For Applied Programs Only)

Answered: 1 week ago