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On January 1, 2018, Benny Corp. purchased 80% of Richard Corp.'s 10 par common stock for 975,000. On this date, the carrying amount of Richard's
On January 1, 2018, Benny Corp. purchased 80% of Richard Corp.'s 10 par common stock for 975,000. On this date, the carrying amount of Richard's net assets was 1,000,000. The fair values of Richard's identifiable assets and liabilities were the same as their carrying amount of Richard's net assets was 1,000,000. The fair values of Grass's identifiable assets and liabilities were the same as their carrying amounts except for plant assets (net) with fair values of 100,000 in excess of their carrying amount. The fair value of the noncontrolling interest in Richard on January 1, 2018, was 250,000. For the year ended December 31, 2018, Richard had a net income of 190,000 and paid cash dividends totaling 125,000. In the January 1, year 1, consolidated balance sheet, goodwill should be reported at a. 125,000 b. 75,000 c. 95,000 d. 0
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