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On 1 January 20x0, Hope Ltd acquired 90% of the share capital of Billy Ltd for $900,000 cash. At that date, the equity section of
On 1 January 20x0, Hope Ltd acquired 90% of the share capital of Billy Ltd for $900,000 cash. At that date, the equity section of Billy Ltd's balance sheet was as follows: $ 700 000 Share capital Retained profits 50 000 Asset revaluation reserve 100 000 Assume all assets and liabilities were recorded at their fair values, except for a piece of equipment recorded at $50 000 but Hope Ltd considers it to have a fair value of $100 000. This equipment is not revalued by Billy Ltd. What was the difference on acquisition under the partial goodwill method? Select one: $50 000 goodwill. $90 000 goodwill. $90 000 bargain purchase. Nil
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