Q7. Alpha Co. purchases Beta Co. for $840,000 cash on Jan 1, 2019. The book value of Beta Cos net assets as reflected on its Dec 31, 2018 statement of financial position is $620,000. An analysis by Alpha on Dec 31, 2018 indicates that the fair value of Betas tangible assets exceeded the book value by $60,000, and the fair value of identifiable intangible assets exceeded book value by $45,000.

How much goodwill should be recognized by Alpha Co. when recording the purchase of Beta Company? [2 marks]

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Answer: Alpha should recognize goodwill of $

Use the following information to answer questions 8a and 8b [1 mark each]

On January 1, 2017, Bingham Inc. purchased a patent with a cost $2,320,000, and useful life of 5 years. The company uses straight-line depreciation. On Dec 31, 2018, the company determines that impairment indicators are present. The fair value less costs to sell the patent is estimated to be $1,080,000. The patent's value-in-use is estimated to be $1,130,000.

Q8a Determine the loss, if any, on patent impairment recognized on Dec 31, 2018

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Answer: Bingham should recognize patent impairment loss of $

Q8b Determine patent amortization expense Bingham should recognize on Dec 31, 2019

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Answer: On Dec 31, 2019 Bingham should recognize patent amortization expense of $