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On January 1, Tesco Company spent a total of $4,422,000 to acquire control over Blondel Company. This price was based on paying $498,000 for 20
On January 1, Tesco Company spent a total of $4,422,000 to acquire control over Blondel Company. This price was based on paying $498,000 for 20 percent of Blondel's preferred stock and $3,924,000 for 90 percent of its outstanding common stock. At the acquisition date, the fair value of the 10 percent noncontrolling interest in Blondel's common stock was $436,000. The fair value of the 80 percent of Blondel's preferred shares not owned by Tesco was $1,992,000. Blondel's stockholders' equity accounts at January 1 were as follows: Preferred stock-98, $100 par value, cumulative and participating; 10,000 shares outstanding Common stock-$50 par value: 40,000 shares outstanding Retained earnings Total stockholders' equity $1,000,000 2,000,000 3,490,000 $6,490,000 Tesco believes that all of Blondel's accounts approximate their fair values within the company's financial statements. What amount of consolidated goodwill should be recognized? Multiple Choice $360,000. $498,000. $858,000 $284,000
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