On January 1, 2016 Gearty Corporation acquired 100% of Olinto Corporation. Gearty Corp. paid $900,000 for the acquisition of all of Olintos stock. On the date of acquisition Olintos assets and liabilities equaled their book value except for land and equipment. The land had a fair value that was $20,000 less than its book value. The fair value of Olinto Corp.s equipment was $100,000 greater than its book value. The equipment has a remaining life of 8 years.

Geartys Stockholders Equity is as follows: Common stock $360,000; Additional paid in capital $270,000; Retained earnings $950,000.

Olintos Stockholders Equity is as follows: Common stock $200,000; Additional paid in capital $270,000; Retained earnings $300,000.

REQUIRED:

Calculate the amount of Goodwill or Gain that resulted from the acquisition.

Prepare the workpaper eliminating journal entries.