Question
On June 1, Cline Co. paid $956,500 cash for all of the issued and outstanding common stock of Renn Corp. The carrying amounts for Renns
On June 1, Cline Co. paid $956,500 cash for all of the issued and outstanding common stock of Renn Corp. The carrying amounts for Renns assets and liabilities on June 1 follow:
| Cash | $ | 188,000 | |
| Accounts receivable | 220,500 | ||
| Capitalized software costs | 356,000 | ||
| Goodwill | 133,000 | ||
| Liabilities | (160,000 | ) | |
| Net assets | $ | 737,500 | |
On June 1, Renns accounts receivable had a fair value of $146,000. Additionally, Renns in-process research and development was estimated to have a fair value of $233,000. All other items were stated at their fair values. On Clines June 1 consolidated balance sheet, how much is reported for goodwill?
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Sm Auditing Integrated Appr Review Copy
Authors: ARENS LO, EBBECKE
7th Edition
0135914396, 978-0135914397
