Question
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?
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